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Post-Fed dollar surge: the winners, the losers ...

Friday, December 16, 2016 - 01:38

The dollar climbs towards a 14-year peak as global markets adjust to the idea of higher U.S. interest rates, triggering worries over who stands to lose from a higher greenback. As Kate King reports, emerging markets are seen as one major casualty.

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The strong greenback returns. The dollar index jumping to a 14-year high of 103.56 on Friday It follows the Federal Reserve's decision to hike interest rates and indicate another three more are on their way in 2017 Good news for America's consumer driven economy, right? (SOUNDBITE) (English) OANDA SENIOR MARKETS ANALYST, CRAIG ERLAM, SAYING: "The U.S. is a big importer of goods from around the world and assuming we don't see many protectionist measures from Donald Trump which is a big possibility then the U.S. consumer purchasing power is always going to be improved." But when it comes to Donald Trump nothing is certain. and a strong U.S. dollar raises concerns about the so called 'boomerang effect' It makes LOCAL products more expensive - and less attractive. A direct threat to Trump's plans to slash the trade deficit and his promise to create more manufacturing jobs. (SOUNDBITE) (English) OANDA SENIOR MARKETS ANALYST, CRAIG ERLAM, SAYING: "When you have got things like productivity improving this is a thing that can help offset the strengthening dollar so it is all going to be a case of how well these companies have adjusted to this higher growth environment in the U.S." The greenback's rally has also put pressure on emerging market currencies and stocks. Developing countries have more than $200 billion in dollar-denominated bonds and loans due next year. But they aren't the only ones feeling the ripple effect China on Friday set the yuan's midpoint at its weakest since 2008 ..amid fears the rising dollar will destabilize trade. and that could further push emerging market exchange rates down

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Post-Fed dollar surge: the winners, the losers ...

Friday, December 16, 2016 - 01:38