USD: Easy money (Credit Suisse)

"In January, we noted that the main feature of the rising dollar was that the current account deficit was fully financed by foreign investments (FDI, portfolio investment).

Now that we approach the end of the year, and as the dollar rose by almost 9% over the year, we are revisiting our analysis.

We are now seeing that a rise in FDI and portfolio investments have more than offset the decline of the official portfolio (lower foreign exchange reserves in emerging countries).

Given that the ECB and Japan's monetary policy is actively driving domestic investors to invest abroad and slowing growth in emerging countries, we believe that the US will have no difficulty in financing its current account deficit.

To sum things up, given that the growth differential between the US and the rest of the world is growing in favour of the USA, and that European and Japanese monetary policy is pushing investors abroad, we believe that FDI will be constructive for the USA.

This provides a strong argument in favour of a continued rise of the dollar in 2016", says Credit Suisse.