The stock market hasn’t collapsed yet, and ostensibly central bankers are giving themselves a pat on the back after raising interest rates by 25 basis points Wednesday. As economists and financial minds are jubilant, one contrarian billionaire investor isn’t as enthusiastic, and thinks it spells doom for the United States dollar.
Jim Rogers, chairman of Rogers Holdings and co-founder of the Quantum Fund, told Sputnik News after the Federal Reserve’s rate hike and explained that the move could overprice the dollar and produce very little benefits for the United States economy. He noted that oil prices could bottom out following the small rate increase.
Rogers said in an interview that any potential results of the rate hike may be temporary, but in the long-term it will do very little to stimulate the U.S. economy. What many are highlighting in the interview is Rogers’s take on a potential rise in competing currencies because the greenback could be overvalued in the coming months but then be unable to uphold the momentum.
“It’s already had an impact on commodity markets, we’ve all known that interest rates would be going higher,” Rogers said. “Commodities are down very dramatically in some cases over the last three or four years, so the first or second interest rate rise could probably make the bottom of commodity markets.”
Although many contrarian investors weren’t in consensus of the Fed raising rates, many did say that if a rate hike would transpire that it would very minuscule. The latter was obviously correct. With rates going up by just 25 basis points, Rogers thinks it won’t lead to any noticeable effects for the national economy.
In fact, according to Rogers, it could facilitate the end of the dollar’s reign on top.
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