04/27/2022 - Yra Harris – The Meaning of the Yen/YUAN Cross

“The level of the YEN/YUAN has significance in as will be covered in a follow-up post but if the YUAN is beginning to depreciate it will cause pain for world markets as a stronger DOLLAR coupled with rising interest rates will be a drag on emerging markets saddled with massive cheap DOLLAR debt. On Tuesday the dollar index reached a two-year high of 1.0232, matching the March 2020 levels when the FED had to open DOLLAR swap lines with nine central banks it didn’t previously have a relationship with to ensure enough dollar liquidity for the global financial system, resulting in a decline in the DOLLAR of 12% over the following nine months.

The U.S. Treasury and the FED need to be cognizant of the vast increase in dollar-denominated debt and the systemic stress brewing with a rising DOLLAR COUPLED WITH RAPIDLY RISINGMARKET-DRIVEN INTEREST RATES.”

Link Here to the Blog Post

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