Stumbled this week, bottom dollar index to 74.80 below, create a financial crisis since the outbreak of the lowest point of history. In the global financial sector deleveraging, major central banks maintain low interest rates and other factors in the context of sustained depreciation of the dollar further changes with global capital flow path – half year, oodles of money are from the US dollar assets off and continue to flock to gold, oil, commodity markets and emerging market countries of stock market and property markets, to the global economy has a small waves.
Depth change global capital flow path
Compared with the past few years, half years global capital flow direction and size is undergoing significant changes. While the dollar continued to go down, as this changes the maximum push behind.
Before the outbreak of the financial crisis last year, the total global financial derivatives is about more than 400 trillion, is the United States, Europe, Japan and other developed countries GDP of more than 10 times, become suspended in the global economy of financial "Lake". The financial crisis broke out causing the global derivatives market avalanche, sharp narrowing overall scale, large amounts of capital began to overflow, short stay in US dollar assets, after depreciation of the dollar, those funds are entering into other assets outside of the US dollar area.
Only to commodity markets, global funds are continuing influx. Data show that the United States 15 commodities futures positions from early October to $ 605 million hands present 658 million hands, 15 species of commodity futures Fund net more positions from 55 million hand doubled to 89 million.
"It is not able to figure out how much capital flows, but the scale of financial flows, is unprecedented in recent decades. The dollar has played the role of financial flows of the booster. "The world of Chinese Academy of social sciences, international finance, Deputy Director, Zhang says.
The dollar is the international financial market and commodity markets of the citizenry of international speculators Chase one of the objects, each developed a certain scale of crisis behind, there is the figure of the rise and fall of the dollar and the resulting from capital flows.
A recent depreciation of the dollar against the background of large-scale flow occurs at the beginning of the century. Affected by the network economy bubble burst and "9.11" events, MEDLINE Chuwei continuous interest rate cuts to stimulate the economy, investors had to sell the dollar, which led to the US dollar since 2003, continued soft, a few years time the dollar index dropped by 40%. Funds from us assets in quick access to real estate and derivatives areas, once brought prosperity real estate market, but also for several years after the real estate bubble and the financial crisis last century rare foreshadow buried.
Half years, the US dollar devaluation to open new again. The dollar index from 90 points to 75 points even in just half a year, dropped by more than 20%. Market investors funds more concentrated on other financial products, their investment behavior and by the end of time dollars, sell higher-yielding currencies and commodities and stocks, turning in the opposite direction of the operation, a large amount of money begins to overflow into the area of asset other than United States dollars.
The dollar will bring the seesaw effect
The US dollar is the currency of most commodities pricing, so the dollar triggered such a "seesaw" effect: on one side is the US dollar index of step by step, one side is u.s. dollar-denominated commodities prices further, and other African-American continued appreciation of the currency.
Data show that the recent dollar-denominated international gold price breakthrough $ 1150 per ounce, reached record high in comparison with the beginning of the year, the international copper prices have doubled; oil prices rose also has more than 50%, close to us $ 80 per barrel.
The devaluation of the dollar also brought many African-American currency appreciation. Since the beginning of March this year, Brazil, South Africa and Korea currency appreciation against the US dollar is approximately 38%, respectively, 34% and 31%, Russia rubles and India rupee respectively against the dollar of approximately 24% and 10%.
"From the current look, because the US is already approaching zero, far below most emerging market countries of interest rates, this has resulted in a considerable number of speculators to borrow dollars through and converted into national currencies of emerging market for investment, arbitrage transactions. "The Chinese Academy of finance, a researcher has just said.
"Seesaw" effect behind the real economy of injury. On the one hand, the high commodity prices will give future brings imported inflation; on the other hand, the African-American national exchange rate is likely to cause substantial increases in trade between the countries.
In the year ended 30 September 2009 financial year, the United States government deficit reached a record $ 1.42 trillion, equivalent to the United States 10% of GDP, the highest level since World War II. Economists generally agree that the United States unable to reduce the deficit if the scale, the sharp depreciation of the dollar continues to occur, the future of imported inflation would exacerbate, the world economy could face new challenges.
Induced impact emerging asset market channels
Dollar accelerated a short-term capital flows, developing asset markets increasingly hot money into destinations, half year, China, Brazil, Thailand and other countries have emerged in the room rate, stock price.
From capital flows tracking Agency data, this year EPFR, around 530 billion into emerging markets equity fund. This has to a certain extent help to push the price of the asset. In combination, the MSCI emerging markets index since the beginning of this year have risen over 60%. BRIC, Brazil's stock market rises nearly 140%, Russia stock market rose by 130%, India's stock market rises by more than 90% of the Mainland's stock market is up 60%. Indonesia, the Philippines, Thailand, Viet Nam, Argentina, and other emerging markets stock market gains are more than 50%.
With the surge in the world of real estate prices in some areas. Korea, Singapore, and real estate market in General, Brazil's capital city Brasilia city property market price year exceeds 120%, but in China, Beijing, Shanghai and other major cities property prices flat
Are up more than 40%."This phenomenon is not difficult to explain. At the present stage, the real economy level investment prospects are not encouraging, while countries with lower interest rates will reduce the desire to promote savings and overseas funds on marketable securities and other physical assets. This surge in asset prices, implied a certain risk, but the liberal policy of USD $ arbitrage activity, further exacerbates this risk and to national policy authorities of serious constraints. "Have just said.
China Banking Regulatory Commission Chairman Liu mingkang recently at the International Conference also expressed this concern: United States maintained low interest rates push a huge dollar arbitrage investment behavior, severe impact of the global asset prices on global economic recovery, especially emerging market recovery constitutes the formation of reality.
It is important to note that there are signs that this impact is increasingly infiltrated into the real economy. Economists believe that asset prices will affect the real economy capital flow path, so that should have access to the real economy in the areas of capital flow to other areas.
"The development of Chinese private enterprises in Zhejiang Province is best, but I found the Zhejiang, many enterprises the factory took a bank loan mortgage to buy, buy buy stock or commodity, this is a very dangerous thing. "Economists" said.
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