Macro
Why the dollar still runs the tape
The dollar is the price of money for the whole world. When it moves, everything reprices, whether your chart shows it or not.
A funding currency
Most desks treat the dollar as one chart among many. It is not. It is the unit the rest of the screen is quoted in, so a move in the dollar is a move in everything at once.
When the funding currency tightens, the periphery pays first. Emerging-market equities, high-beta crypto and long-duration tech all lean on the same cheap dollar, and they all wobble together when it leaves.
The dollar is risk appetite, priced in the only unit everyone shares.
The board, this morning
- DXY104.2+0.3%
- US 10Y4.28%+4 bps
- Gold2,318-0.6%
- BTC68,900-1.4%
What to watch instead of the price
Watch the real yield, not the nominal one. A rising nominal yield with falling inflation expectations is a real-yield shock, and that is the version of higher rates that actually drains the riskiest corners of the tape.
Not investment advice. Past performance does not guarantee future results.
