Equities hit new highs but merely on back of weaker dollar, not growth

Week ending Friday July 14 2017 The USD slumped twice last week and both slumps coincided with jumps in the S&P 500. If the direct impact on equities is from stronger overseas revenues and earnings, then there seems little impact from monetary policy. But if the weaker dollar is implying easier monetary policy ahead, then there is an impact, albeit indirectly. The first 0.5% drop in the USD on Tuesday was linked to a mixture of bits of news. All sorts of things were cited: Trump Jnr’s emails, Fed Governor Brainard’s dovishness, the Bank of Canada raising rates, strengthening the…

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