Stanley Druckenmiller Shorts Dollar After ‘Biggest Miss of My Career’

• Stanley Druckenmiller is shorting the US dollar after missing last year’s rally.
• He said it will keep falling due to interest rate cuts and a rise in non-dollar trade agreements.
• “And you have Lula running around asking why we have to do trade in the US dollar, and he’s right to.”

Billionaire investor Stanley Druckenmiller said he is shorting the US dollar after missing out on last year’s rally.

Speaking at an event hosted by Norway’s sovereign wealth fund, he said the move is his only confident trade in what he sees as the most unpredictable period of his career, according to The Financial Times.

“One area I’m comfortable is I’m short the US dollar,” he said Tuesday. “Currency trends tend to run for two or three years. We have had a long [run] higher.”

The US Dollar Index, which compares the greenback against a basket of other global currencies, hit 20-year highs last fall, thanks to aggressive monetary tightening from the Federal Reserve.

But it’s a rally that Druckenmiller wasn’t a part of: “It was probably the biggest miss of my career.”

The dollar has fallen by nearly 10% since November, but the Duquesne Capital founder said the downtrend is not over.

That’s because he thinks the Federal Reserve will soon have to start cutting interest rates to respond to an economic downturn.

Druckenmiller also cited the dollar’s weaponization as another factor in his short bet, alluding to Western sanctions on Russia last year that froze its foreign exchange reserves in response to Moscow’s invasion of Ukraine.

But for many dependent on the dollar for trade, the move sparked efforts to use other currencies. Druckenmiller pointed to Brazilian President Luiz Inácio Lula da Silva, who recently called for the BRICS countries to create a new currency.

“And you have Lula running around asking why we have to do trade in the US dollar, and he’s right to,” Druckenmiller added.