By Robin Wigglesworth
For a brief moment in 2007 Gisele Bündchen became the fetching face of dollar doomsayers, when her agent revealed that the Brazilian supermodel would prefer to be paid in euros rather than the struggling US currency.
At the time it seemed like a sensible move. Dollar-bashing was all the rage. Even rap stars waved wads of euros instead of the usual “Benjamins” – $100 bills. But after the onset of the financial crisis in 2008, the dollar defied the sceptics as investors swallowed misgivings and dived into everyone’s default safe place: US government bonds. Even as the Federal Reserve printed $2.5tn to prevent a financial collapse, the dollar stayed stable.
Now that the US is haltingly climbing out of its economic morass and the Fed is beginning to unwind its monetary stimulus programme, strategists and investors are predicting another golden age for the US dollar. This could have far-reaching implications for the developing world, including Ms Bündchen’s native Brazil.