The” strong ” dollar may soon come to an end, and the years of high exchange rate of the us currency will be replaced by a period of low quotations, writes Bloomberg, referring to the surveyed economists.

Many of them point to the similarity of the current situation with 1985 and 2002, when a sharp change in the monetary policy of the Federal reserve system (fed) led to a decrease in the flow of foreign investment and a weakening of the dollar. Now the reason for this reversal was the reduction of the fed’s base rate to the level of 0-0. 25 percent.

The us regulator is not the only one who eases monetary policy in a crisis, as most of the world’s Central banks do, including the Russian Central Bank. As a result, government bond yields in many countries are declining, and investors are beginning to look for other assets to invest in.

The situation is aggravated by the inability of the US authorities to quickly cope with the spread of the coronavirus, the growing government debt and the quantitative easing program of the fed itself. As part of it, the regulator buys up corporate and government securities, increasing their value and further lowering the yield.

Until recently, widespread rate cuts, which began long before the current crisis, played into the hands of the dollar. US Treasury bonds, already considered a benchmark of reliability, additionally attracted investors with higher yields compared to assets in other currencies. For example, last year the German Finance Ministry issued bonds with a negative coupon rate, and some Swiss banks began to set similar conditions for deposits.

However, now rates in the US are almost equal to the level of Europe and Japan, and additional purchases from the fed have only strengthened this process. As a result, the long-term bullish trend (bets on the growth of the dollar) in early summer was replaced by a bearish one. By the end of June, the number of bets against the dollar (through the sale of futures and purchase of put options) on the foreign exchange market for the first time in a long time exceeded the number of transactions in support of it.

Financiers interviewed by the publication agree that it is too early to talk about the end of the dollar as the main world reserve currency, since most international transactions are still conducted in it. In addition, a moderately “weak” one is beneficial to American exporters and will reduce the balance of payments deficit, as President Donald trump has repeatedly said. However, what is happening in the foreign exchange market is confirmation that the dollar has been overvalued for a long time.