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The US dollar (DX=F, DX-Y.NYB) dipped after reports that trade talks between the US and South Korea touched on currency policy, according Bloomberg.
Great Hill Capital Chairman Thomas Hayes joins Catalysts host Julie Hyman to explain how a weaker dollar could lift S&P 500 (^GSPC) earnings in the back half of the year and help rebalance trade.
To watch more expert insights and analysis on the latest market action, check out more Catalysts here.
there was a story today, um, that Bloomberg reported that the US and South Korean in their Korea in their discussions over trade had brought up currency as a possible lever. We did see the dollar pull back, particularly against the South Korean won on this. There's a lot of debate over whether a weaker US dollar is a good thing or not.
Uh, it's going to help earnings in the back half of this year for sure. That's already happened. The dollar's been weakening. We're going to get a counter-trend bounce because everyone's bearish on the dollar right now. Uh, however, the Chinese were pretty smart about this tariff negotiation because what they effectively did was they devalued the yuan by 20% ahead of talks. So it's like, okay, you want to do 20% tariffs, we're kind of flat. It's fine. Uh, so I I I think you're going to see a trend, uh, there has been a a theme earlier in the year, there were rumblings about the Mar Lago accord where they would devalue the dollar to balance out trade. Uh, I I think you're going to see some pockets of this. I think the trend for the dollar moving forward is going to be a little bit lower in the coming years. That's going to help, uh, S&P earnings. That's going to help our trade rebalancing, and it's going to be a positive thing all around.
We'll see. Tom, thanks so much for being here. Appreciate it.