The Wall Street Journal (WSJ) diagnosed on the 18th (local time) that the once-in-a-generation phenomenon of the dollar's superstrength is becoming a big problem for the rest of the world except the United States.
The extreme volatility of the dollar, used as a major currency in global trade and finance, is bound to cause widespread repercussions.
A strong dollar is not only further slowing the already sluggish global economic growth, but also exacerbating inflation in other countries, making central banks a pain in the ass.
The Chinese yuan exchange rate broke the 7 yuan level to the dollar last week, and the Japanese yen has fallen by about 20% this year, reaching its lowest level in 24 years.
The dollar index, which measures the value of the dollar against major currencies, is expected to surge more than 14% this year alone, recording the largest annual increase since the index was launched in 1985.
Given that the US Federal Reserve (Fed) is likely to continue raising interest rates, the dollar's strength is likely to continue for some time to come.
This is because, despite the recent drop in oil prices, the consumer price index (CPI) surged more than expected in August, so a large interest rate hike such as a 'giant step' (0.75 percentage point increase at a time) is likely to occur even after September. .
After the CPI announcement in August, some even raise the possibility of an 'ultra-step' (1% point rate hike at a time).
The relatively gloomy economic outlook for other major countries besides the US is also driving the dollar further.
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Europe is facing an energy crisis due to an 'economic war' with Russia, and China's decades-long real estate boom is waning, the newspaper pointed out.
Japan also posted the largest trade deficit in its history last month.
"I think this (strong dollar) is still in its infancy," said Raguram Rajan, a professor at the University of Chicago's Booth School of Business.
The World Bank said in a report on the 15th that the global economy is heading towards a recession, warning that a "series of financial crises" could occur in emerging markets and developing countries.
One of the reasons is that high interest rates and a strong dollar from the US have increased the burden of dollar-denominated debt that emerging market countries and companies have to repay.
According to the International Finance Association (IIF), emerging market governments have $83 billion in dollar-denominated debt, due by the end of next year.
Gabriel Stern, head of emerging markets research at Oxford Economics, told the WSJ that "if the dollar gets any higher, it's going to be the straw that breaks the camel's back."
Therefore, experts are also looking forward to the possibility of an international joint action to counter the strong dollar, such as the Plaza Accord of 1985.
"There could be good reasons for a joint intervention to lower the dollar," said Pareshi Upadyaya, director of monetary strategy at asset management firm Amundi.