US Dollar Still Overvalued - IMF

In an interesting story today, the International Monetary Fund indicated and conceded that the US dollar was being used to fund a carry trade and that it might still be overvalued despite it’s large fall already this year.

Quoting from Bloomberg’s story: (Full Story Here)

“There are indications that the U.S. dollar is now serving as the funding currency for carry trades,” the IMF said in a report published today. “These trades may be contributing to upward pressure on the euro and some emerging economy currencies.” While the dollar “has moved closer to medium-run equilibrium,” it is still “on the strong side.”