Overnight the US Dollar Index, which tracks the value of the greenback against a basket of currencies, dropped to 89.14, below the benchmark of 90 for the first since 2014.

Back in 2016, the US economy was leading in terms of growth, boosting the Dollar’s stellar performance in anticipation of the Federal Reserve’s interest rates rise in 2017. But the US currency is now continuing to underperform as optimism around global growth and, more importantly expectations of inflation, are gathering pace.

This weakness in the Dollar is more to do with other countries catching up with the US growth and bolstering their currencies.

The Euro was strong throughout 2017, thanks to improving economic data and the fear of populism easing. The focus this year though has very much shifted to the UK, with the Pound up almost 4% – a level not seen since before Brexit in June 2016.

Even Japan, which has been battered by more than a decade of low inflation and low growth, has shown robust recovery. As a result, the International Monetary Fund raised its growth forecast to 1.2% on broad-based global recovery.

Global stock markets reflect this optimism: the US S&P 00 closed yesterday at 2,839.13, having set another record high. But with equity prices at astronomical highs, we would advise to view this with an element of caution.”

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