U.S. Dollar's Safe-Haven Status May Not Be So Safe, BofA Says
- The greenback is ‘dominant’ haven when China is driving risk
- Yen and Swiss franc preferred amid Europe, U.S. brinksmanship
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Currency traders may not want to put all their trust in the dollar’s status as a haven, especially if the U.S. trade conflict with China calms down.
The greenback is the “dominant” haven when the most pressing risks are associated with China, Bank of America strategists including Adarsh Sinha wrote in a note to clients. A cooling of tensions with China could bring political brinkmanship in Europe and the U.S. into focus, when the yen and Swiss franc would likely offer better risk-reward going into next year, the strategists wrote.