The U.S. dollar is poised to extend its steepest rally in six years, according to two of the world’s biggest bond investors.
Jeffrey Gundlach at DoubleLine Capital LP and Scott Mather of Pacific Investment Management Co. both said they’re bullish. The New Zealand dollar led declines against the greenback today, dropping 1 percent after a report showed inflation in the South Pacific nation slowed.
“The dollar is the place to be,” Gundlach said yesterday at ETF.com’s Inside Fixed Income Conference in Newport Beach, California. It’s a “no-brainer” for Germans and Spaniards to put their money into U.S. Treasury securities, he said.
The kiwi tumbled to 78.51 U.S. cents as of 11:38 a.m. in Tokyo from 79.29 yesterday, heading for the biggest decline since Oct. 3. New Zealand’s consumer price index rose 1 percent in the third quarter from a year earlier, slowing from 1.6 percent in the previous period and prompting speculation policy makers will delay raising interest rates.
The Bloomberg Dollar Spot Index, which tracks the greenback against 10 other currencies, has gained 4.8 percent in 2014, headed for its biggest annual advance since 2008. The U.S. currency advanced 0.1 percent versus the euro to $1.2638.
Source: Bloomberg (23 Oct 2014)
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