Bloomberg Surveillance · Friday, July 31, 2026
Malika Sakeva explained that the US dollar's strength is currently supported by significant foreign interest and inflows into US equities, rather than US Treasuries. She predicts that in a future equity correction, the dollar might not perform as well due to its increased sensitivity to equity capital.
“We are seeing a sort of a swap from a lot of interest in US treasuries to a lot of foreign interest in US equities, and this tremendous amount of inflow into the US stock market over the last year or so has actually provided a good amount of support for the dollar.”
“Now, my thesis is that looking ahead, the risk profile of the dollar could start to change. So in the next big equity correction, it's not necessary that the dollar will necessarily do well because the dollar is now much more linked to and much more sensitive to equity capital than it has been in the past. So I think the change in correlations between stocks and the dollar is really going to be a big focus for the market.”