Amidst economic challenges, recent reports indicate a concerning trend for the United States, with implications both domestically and globally. Recent data suggests that half of the Americanstates are currently experiencing a recession. This sustained period of economic downturn can lead to decreased consumer spending, increased unemployment rates, and overall economic instability.
Concurrently, the erosion of the US dollar (USD) persists. Despite its historical dominance, the American Dollar is facing challenges due to various economic and political factors, contributing to a gradual decline in its global hegemony.
US dollar collapse is imminent
The United States is currently facing a wave of economic and financial downturns. A recent analysis published by a well-known financial expert, Game of Trades on X, has outlined a new statistical insight into the state of the American recession and currency degradation.
The analysis provided by the analyst emphasized the considerable downturn that half of the American states are currently suffering. According to the pooled analysis, 22 American states had an economic collapse in the fourth quarter of 2023.
These American states, known as an economic recession, are experiencing repressed economic growth, with measures such as state unemployment rates, average manufacturing hours worked, real wages, and nonfarm payroll employment hitting rock bottom.
The analyst later analyzed the present US recession. The handle rapidly highlights the causes, highlighting how “vulnerable” states are prone to severe economic crises and meltdowns.
“Recessions don’t occur overnight, with all states simultaneously entering one. Weaker and more vulnerable states tend to be the first to experience a recession. Once a certain threshold is reached, it becomes inevitable that other states will follow suit.”
The expert went on to describe a serious detail in the combination. Game of Trades emphasized that the nation may soon enter its formal recession phase, considering that 22 of its states are already experiencing economic difficulties and unexpected swings.
American dollar weekend forecast
The American Dollar reclaimed greater stability over the course of an additional notably fruitful week, concluding its second consecutive week of gains and reclaiming the region in which the Dollar Index (DXY) was monitoring its decline to 104.00.
Concurrently, the index increased its distance from the recent breach of the pivotal 200-day Simple Moving Average (SMA) at 103.70, thereby creating an opportunity for the bullish posture to persist for the time being.
Interestingly, the weekly gain in the American dollar was accompanied by a decline in momentum during the recent rally in American yields across multiple time frames, which appears to have accelerated since the FOMC meeting. On the other hand, this ascent seems to have been propelled predominantly by the substantial depreciation in the Japanese Yen.
This effect was exacerbated by the BoJ’s dovish rate rise earlier this week. The Greenback’s weekly price movement was primarily influenced by the FOMC report released on March 20.
The Federal Reserve (Fed) maintained its anticipated fed funds target range (FFTR) of 5.00% to 5.25% with regard to the latter. Moreover, the Committee raised its interest rate projections for 2025 and subsequent years, as well as its core Personal Consumption Expenditures (PCE) estimates for 2024, which had been established in December at a range of 2.4-2.5%, to a range of 2.5-2.6%.
Investors’ focus has shifted to the release of another inflation data, this time from Personal Consumption Expenditures (PCE), at the end of next week. These numbers will be released alongside other crucial indicators, such as another revision to the Q4 GDP Growth Rate, Durable Goods Orders, the typical weekly Initial Jobless Claims, and the final Michigan Consumer Sentiment gauge.
