More dire warnings about the dollar were made recently in an editorial by Yale economist and and former chairman of Morgan Stanley Asia, Stephen Roach where he states: “I continue to expect this broad dollar index to plunge by as much as 35 per cent by the end of 2021″.
Roach says the US Dollar has “entered the early stages of what looks to be a sharp descent.”
“The dollar remains the most overvalued major currency in the world”, he said.
“Lacking in saving and wanting to grow, we run these current account deficits to borrow surplus saving, and that always pushes the currencies lower,” he said. “The dollar is not immune to that time honored adjustment.”
On a recent appearance on CNBC, Roach also noted he sees growing odds of a double-dip recession, putting the probability of a U.S. double-dip recession above 50%.