The bid for European and emerging market stocks means investors are pulling funds out of dollars and putting them into other currencies.
- That combined with expectations of more monetary policy easing from the Fed and no end in sight to its zero interest rate policy has pushed the dollar to its lowest level since April 2018.
- The dollar index, which tracks the greenback’s value against six major global currencies, fell to a 2.5-year low of 91.13 overnight.
- Traders are wagering the slide will continue as net short bets that the dollar will fall in value rose to their highest level since late October, according to CFTC data released on Monday, calculated by Reuters.
Of note: The U.S. dollar fell to its lowest in 2.5 years against the euro and the New Zealand dollar on Tuesday.