The turmoil in the world financial markets continues. Changes occur so fast that experts fail to track them. Despite the positive data on the state of the US economy, the greenback is weakening, while the euro and the yuan are strengthening, despite domestic problems, and US stock indices are heading to reach new highs.
While the market is thinking over the recent fears of a full-scale trade war, the yuan’s devaluation, and the rise in the euro against the background of the Turkish crisis and the difficult political situation in Italy, new challenges are emerging. And most of them relate to the US and the dollar. The aggressive trade policy of Donald Trump has resulted in the fact that European officials have declared their intention to develop an analogue of SWIFT. Trying to defend against US sanctions, Europe starts to seriously concern over the need to create their own payment system. This will undoubtedly undermine confidence in the dollar. Sanctions, duties, emotional tweets, and other Trump’s tricks look like efforts to harm other economies. More and more countries are looking for ways to avoid money transfers in dollars, and this is quite a natural reaction.
In early autumn, the dollar will most likely take paths in two directions: strengthening and weakening, although, the order may be opposite. Such strong fluctuations in the currency markets will have a huge impact on the world economy. This is probably the beginning of the financial crisis, but in a new unusual way.
