Billionaire investor Stanley Druckenmiller shorts the greenback after ‘largest miss of my profession’ on Fed price view and weaponized foreign money fears

• Stanley Druckenmiller is shorting the US greenback after lacking final 12 months’s rally.
• He mentioned it should preserve falling because of rate of interest cuts and an increase in non-dollar commerce agreements.

Billionaire investor Stanley Druckenmiller mentioned he’s shorting the US greenback after lacking out on final 12 months’s rally.

Talking at an occasion hosted by Norway’s sovereign wealth fund, he mentioned the transfer is his solely assured commerce in what he sees as probably the most unpredictable interval of his profession, in keeping with The Monetary Instances.

“One space I am snug is I am quick the US greenback,” he mentioned Tuesday. “Forex tendencies are inclined to run for 2 or three years. We’ve got had a protracted [run] greater.”

The US Greenback Index, which compares the dollar in opposition to a basket of different world currencies, hit 20-year highs final fall, because of aggressive financial tightening from the Federal Reserve.

Nevertheless it’s a rally that Druckenmiller wasn’t part of: “It was in all probability the most important miss of my profession.”

The greenback has fallen by almost 10% since November, however the Duquesne Capital founder mentioned the downtrend just isn’t over.

That is as a result of he thinks the Federal Reserve will quickly have to begin reducing rates of interest to answer an financial downturn.

Druckenmiller additionally cited the greenback’s weaponization as one other consider his quick guess, alluding to Western sanctions on Russia final 12 months that froze its international alternate reserves in response to Moscow’s invasion of Ukraine.

However for a lot of depending on the greenback for commerce, the transfer sparked efforts to make use of different currencies. Druckenmiller pointed to Brazilian President Luiz Inácio Lula da Silva, who not too long ago referred to as for the BRICS international locations to create a brand new foreign money.

“And you’ve got Lula working round asking why we’ve got to do commerce within the US greenback, and he is proper to,” Druckenmiller added.