Long-term investors see dollar decline as buying opportunity — BNY

The dollar's recent slide to a six-month low is creating new opportunities for long-term investors. According to BNY Bank, investing in the US currency is gaining traction among institutional investors seeking to reduce hedges against its depreciation. At the same time, short-term speculators are increasing their bets against the dollar.

State Street Global Markets reports growing demand for the Japanese yen and the Swiss franc as safe-havens. The dollar has slipped in the rating of secure currencies, but its position in the list of risky assets has not yet deteriorated. In addition, the dollar has not yet reached the oversold zone, State Street says.

As reported by Bloomberg, global trade tensions created by the United States have made the markets question the role of the dollar as the world's reserve currency. It has also triggered a sell-off in US Treasuries in favor of other safe-haven assets, such as German bonds. Meanwhile, institutional investors are taking a more cautious approach as they seek long-term returns, the agency notes.