Stock market today: Dow, S&P 500, Nasdaq futures slide as Wall Street braces for Fed kick-off
A wave of dollar (DX=F) selling in Asia is an ominous sign for the greenback as the world’s export powerhouse starts to question a decades-long trend of investing its big trade surpluses in US assets.
Ripples from Friday and Monday’s record rally in the Taiwan dollar (TWD=X) are now spreading outward, driving surges for currencies in Singapore, South Korea, Malaysia, China and Hong Kong.
The moves sound a warning for the dollar because they suggest money is moving in to Asia at scale and that a key pillar of dollar support is wobbling.
While Tuesday brought a measure of stability, following a stunning 10% two-day leap for Taiwan’s currency, Hong Kong’s dollar (HKD=X) was testing the strong end of its peg and the Singapore dollar has soared close to its highest in more than a decade.
“To me, it has a very sort of Asian-crisis-in-reverse feel to it,” said Louis-Vincent Gave, founding partner of Gavekal Research, in a podcast, due to the speed of the currency moves.