In a slap in the face to everyone who thought that the initiation of QE would be the deathblow for the dollar, the old greenback has surged since the Fed officially announced the program on November 3.
Don’t think the announcement of QE had something to do with a rising dollar?
Fine, but then you have to stop claiming — as many people are — that QE is causing yields to surge, because it’s rising yields that are causing the dollar to rise.
Got it? If you want to argue that yields are jumping due to QE nervousness, you also have to accept that QE is strengthening the dollar.
Here’s USDJPY. The bottom was basically right after QE.