Its Over, page-13717

Yes, saintex, what you say about strong US dollar policy (per Yellen) to thwart inflation is true. The more important message from that article is the potential for the feedback loop wrt to the dollar.

The DXY is not going to rise everyday, it probably be an up to 9% rise over the coming 4-8 months. The faster it rises the faster it is also likely to fall, and when it starts falling, it falls and starts a falling trend. Until that upward trend is broken via a breakdown , it is going to continue to go higher over time. So IMO a faster rise in the DXY will probably see it peak sooner than later, I can't see it rise above 120.

Wall St is too optimistic about peak inflation. Their perception is that if it peaks, it must start falling quickly thereafter. It is that bit that I find to be unrealistic. Demand destruction via higher interest rates will slow down consumption over time as monetary policy has a lag effect. It is unlike a stimulus check that people start spending straight away. This is also because it was noted that US savings rate is still decent and could still cushion higher rates and consumption for a little longer. So demand destruction will take a while longer and then consumption goes into a cliff when companies starts laying off and clamping down. So until then, inflation would likely remain high for longer and the Fed would have to either raise rates a little more or stay pat. Not dropping in Q1 23.