The main surprises that the dollar is preparing this year will be related to inflation, Andrey Rusetsky, asset manager of BCS World of Investments, is sure.
As he told the Prime agency, by the end of the year the Russian ruble may strengthen to the level of 72-73 per dollar. In this case, investors should take into account the factor of dollar inflation, which can lead to the loss of part of the income.
According to Rusetsky, increased inflation will occur due to government stimulation of the economy during the crisis. In the United States, the total number of launched stimuli exceeds 25% of the country’s GDP, while the American economy fell by no more than 9% of GDP in the second quarter of 2020.
“Such significant stimulus could lead to higher dollar inflation. The latest data indicate inflation of 4.2%, which is one of the highest rates in the last 30 years, ”the economist explained.
The expert added that it would not be beneficial for Washington to fight inflation with increased rates due to the increased national debt. According to him, low rates are beneficial for the budget, which, after taking inflation into account, have a negative value.
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