After a first-half fear fest, a new scare story has investors shivering: the Attack of the Greenback. The US dollar is up 9.0% this year against a trade-weighted basket of global currencies and 16.1% since last June. It is flirting with parity against the euro for the first time in 20 years and at 30-year highs against the yen and pound. It all sparks fears a runaway buck will torpedo US firms’ overseas profits and slam Emerging Markets. But the buck is a bogus bogeyman. Dollar doldrums are less about economics and more about pulverized sentiment—a counterintuitively bullish sign for 2022’s back half. Don’t let them spook you.
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