Crisis Management for a Conflict with North Korea

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美元地位岌岌可危?專家示警「亞洲上演大逃亡」:恐面臨75.7兆元雪崩式拋售

Is the status of the US dollar in jeopardy? Experts warn of "Asia's Great Exodus": May face a 75.7 trillion yuan avalanche sell-off

Yahoo News Taiwan | Local Language | News | May 9, 2025 | UndeterminedTrade Issues and Numbers

Only one month after the launch of the tariff policy by US President Donald Trump, the US dollar index declined by 5%, leading to a wave of selling. Analysts, including Stephen Jen and Ren Yongli, warn that Asian countries, which have accumulated large dollar positions, may start selling off, potentially leading to an "avalanche-like" sell-off of up to $2.5 trillion. This situation is exacerbated by ongoing trade tensions that may prompt Asian investors to repatriate their funds and reduce their exposure to the weakening dollar.

Eurizon SLJ Capital's Jen Young-li and economist Joana Freire highlighted in a report that Asian exporters and investors have built up significant US dollar positions over the years, contributing to an expanding trade surplus with the United States. The large-scale outflow of these dollars could risk a sharp depreciation of the US dollar against Asian currencies. Recent market movements indicate that the US dollar has declined approximately 8% from its peak, while most Asian currencies have strengthened against it, suggesting a shift in strategy among Asian policymakers.

The report identified several Asian countries, including China, Taiwan, Malaysia, and Vietnam, as holders of substantial "single dollar long positions," contributing to potential financial imbalances globally. The comments from Ren Yongli emphasized the fragility of the US dollar in the current global financial environment, amid speculation about the impacts of currency appreciation as a negotiation tactic in trade agreements with the United States.

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