By Currency Research Associates LLC
Aug 15, 2018
Assets & Allocation
Aug 15, 2018
Start of New 15-Year Dollar Cycle Points to 40% Dollar Decline
"We use the dollar as a lens to assess how trends will unfold in the dollar and other markets since the dollar is the most important price of all prices. Its cyclical long-term trends cause investors, consumers, governments and companies to change their investment and buying patterns as the dollar becomes expensive or cheap. The start of a new 15-year cycle in the dollar points to the dollar falling 40% against the euro and other currencies in the immediate years ahead. The global purchasing power of family offices and investors with large investments in dollar-denominated assets will see their global net worth plummet. Investors urgently need to address this risk and they need to implement a strategic long-term plan to avoid the large losses the dollar’s decline will cause as well as turn its decline into an opportunity to profit as currencies rise.”
- Ulf J. Lindahl, CEO, Currency Research Associates LLC
A new 15-year cycle began in the dollar in January 2017. As the cycle unfolds into 2024, the dollar’s coming decline will have a massive impact on investors reducing their global net worth.
In the past three 15-year cycles, the dollar fell for an average of 8 years and its declines averaged 53% against the euro. That’s equal to the euro rising 114% against the dollar. The DM, which preceded the euro, rose 110% against the dollar in the first cycle; 145% in the second cycle, and the euro then rose 87% against the dollar in the third cycle. The cycle that started in 2017 can be projected to be as large as the prior three 15-year cycles.