US Treasury Secretary Janet Yellen said the soaring US dollar is not unbalancing markets, as countries rush to defend their currencies or face the risk of a debt crisis.
Speaking in an interview with the Financial Times, Yellen criticized the OPEC+ decision to cut oil output quotas, saying they have a negative impact on the global economy.
The US dollar skyrocketed 16% this year against its major counterparts — and this is having a destabilizing effect on other currencies.
But Yellen brushed off worries about market volatility and disruption, the FT reported.
“We’re monitoring currency movements and their impacts very closely,” she said. “And we continue to think that markets are functioning pretty well and are generally appropriate given the underlying differences across countries and policies and economic situations.”
The effects of a soaring dollar are starting to have an impact on other economies. The Bank of Japan recently intervened to defend the yen for the first time in 24 years, while Korea and China have also made moves. The euro has plunged below parity with the greenback in recent months.