US dollar: Their currency, your problem

The US Treasury secretary told a room of European counterparts that “the dollar is our currency, but it is your problem”.

This soundbite is actually more than 50 years old – courtesy of 1971 Treasury secretary John Connally. But what was true then still rings true now: concerns about the spillover effects of a US dollar rally are nothing new. The dollar is surging, causing headaches for both advanced and emerging economies. In the past, US policymakers have agreed to international action to curb the strength of the dollar. Is there a chance that they will do so again today?