US corporate earnings in third quarter continue to mourn strong dollar

Having bad earnings report? Well, just blame it on the dollar. Strangely according to the figure by Bloomberg, 60 percent of the corporate America blamed the strong dollar for the disappointment in the earnings report. While it is understandable that any company having cash flows coming from the Great Britain is having a bad time (the pound plummeted against the dollar after EU-referendum), for other currencies, the dollar is not really at any unprecedented levels. The dollar index, which is the value of the dollar against a basket of currencies) is currently trading at 97.65. As a matter of fact, the dollar is hovering around these levels since last year. The dollar is up just by a little more than 2 percent this year so far. Even if the companies believed that the dollar could be a problem, they could have hedged their exposure.

We at FxWirePro believe that the dollar is being used as a punching bag by corporate America. Some of the other issues highlighted are higher wages, lower energy prices, Brexit, US election, higher rates (really?) and the weakness in China.