gold bitcoin federalreserve fed ‘A deep and severe recession' will come if ‘aggressive' Fed keeps tightening - Ronald-Peter Stoeferle
A severe recession could occur if the Federal Reserve keeps tightening and the dollar becomes stronger, said Ronald-Peter Stoeferle, Managing Director at Incrementum AG.
The U.S. Dollar Index is currently at 114, and has gone up 18.9 percent over the year. Stoeferle said that a strong U.S. dollar could act “like a wrecking ball,” especially for emerging markets with dollar-denominated debt. Stoeferle said that the DXY’s strength is largely due to the Euro’s weakness, as the European Union struggles through an energy and economic crisis. The DXY basket contains 57.6 percent Euros.
After Russia invaded Ukraine, Western nations kicked Russia out of the SWIFT international payments system and imposed other sanctions, including freezing the country’s $630 billion in central bank assets.