Barkin Says Dollar Contagion a Risk But Fed Focus Is US Economy - BNN Bloomberg

(Bloomberg) -- Federal Reserve Bank of Richmond President Thomas Barkin said the strength of the dollar has potential spillover implications for the global economy, but at the end of the day the central bank is focused on the US economy.

“The thing you worry about is what collateral damage could there be to international economies and in particular their financial systems,” he told an audience Monday at a conference on technology-enabled disruption at the Atlanta Fed. “There are a lot of countries in the world that have chosen to borrow in dollars and so these get more expensive.”

The dollar has strengthened more than 10% against its major rivals this year as the Fed aggressively raised interest rates to curb the highest inflation in nearly four decades, while stocks have fallen and bond yields surged.

“You could worry about the risk of financial contagion as the dollar -- I mean there’s a whole bunch of stuff to worry about it. It should be keeping me up at night,” Barkin said. “But in the end, our mandate is to help operate the US economy. So you worry about it most in terms of does it affect the US economy.”

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Barkin Says Dollar Contagion a Risk But Fed Focus Is US Economy - BNN Bloomberg
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