The global research team at BofA Securities, led by Michael Hartnett, has navigated the curveballs thrown by 2022 far better than most.
The U.S. dollar's share of currency reserves reported to the International Monetary Fund rose in the second quarter, with the Federal Reserve in the midst of an aggressive tightening cycle aimed at stamping out uncomfortably high inflation. The greenback's share of reserves rose to 59.5%, from 58.8% in the first quarter, IMF data showed on Friday. Global reserves, which are reported in U.S. dollars, are central bank assets held in different currencies used in part to support their liabilities.
The dollar rose against the euro on Friday but pared gains late in a session that was muddied by quarter-end trading while riskier commodity-led currencies fell sharply after European inflation hit a record high and U.S. consumer spending increased faster than expected. But while the dollar index was showing its biggest quarterly gain since the first quarter 2015 it was set for its first weekly decline in three weeks. After hitting a record low on Monday, the British currency was on track for a weekly gain after the Bank of England bought British government bonds, known as gilts, on Wednesday, Thursday and Friday.