Why is the US Dollar So Important to Most Spread Betting Markets?

The Dollar is King

One Currency to Rule Them All

So financial spread betting is a pretty British thing but the dollar is king.

And yes, inflation data is dull but it is important for anyone trading US dollar related markets…

And that means pretty much all of us.

Not just Forex spread betting markets like EUR/USD, GBP/USD, USD/JPY or US stocks, these markets are obviously impacted by the value of the dollar.

Most commodities are priced in USD too… so those commodities, i.e. cocoa coffee, cotton, crude oil, gold, silver, sugar, wheat etc. are all made relatively cheap or expensive when the dollar rises or falls.

Don’t Forgot Non US Stocks Though!

Remember that GBP/USD does impact the FTSE 100 by making UK stocks relatively cheap or expensive.

The story goes on.

In short, you need to keep an eye on US dollar moves whether you find it dull or not (and it can be pretty dull).

Big decisions by the US Federal Reserve, and/or changes in dollar valuation, impact nearly all popular spread betting markets.

11 October 2017: Warning on US Dollar Strength

warningJust a little warning… the Fed is getting mixed inflation reports.

If the Federal Reserve concludes that inflation is in play then expect more interest rate increases and therefore more buying of the dollar.

AuthorAlex Turner

Senior Editor, SpreadBetMagazine

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