{"id":14245,"date":"2026-08-03T21:03:49","date_gmt":"2026-08-03T21:03:49","guid":{"rendered":"https:\/\/kngadvisors.com\/?p=14245"},"modified":"2026-08-03T21:37:42","modified_gmt":"2026-08-03T21:37:42","slug":"eleccion-de-la-moneda","status":"publish","type":"post","link":"https:\/\/kngadvisors.com\/en\/eleccion-de-la-moneda\/","title":{"rendered":"Why Currency Choice Matters as Much as Asset Choice"},"content":{"rendered":"<p class=\"wp-block-paragraph\"><strong>Monday, August 3, 2026<\/strong><\/p>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<div class=\"wp-block-columns is-layout-flex wp-container-core-columns-is-layout-8f761849 wp-block-columns-is-layout-flex\">\n<div class=\"wp-block-column is-layout-flow wp-block-column-is-layout-flow\">\n<p class=\"has-text-align-center wp-block-paragraph\">Audio in Spanish<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-video is-provider-youtube wp-block-embed-youtube wp-embed-aspect-16-9 wp-has-aspect-ratio\"><div class=\"wp-block-embed__wrapper\">\n<iframe title=\"Why Currency Choice Matters as Much as Asset Choice\" width=\"500\" height=\"281\" src=\"https:\/\/www.youtube.com\/embed\/9wP6PJsMAWw?feature=oembed\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share\" referrerpolicy=\"strict-origin-when-cross-origin\" allowfullscreen><\/iframe>\n<\/div><\/figure>\n<\/div>\n\n\n\n<div class=\"wp-block-column is-layout-flow wp-block-column-is-layout-flow\">\n<p class=\"has-text-align-center wp-block-paragraph\">Audio in English<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-video is-provider-youtube wp-block-embed-youtube wp-embed-aspect-16-9 wp-has-aspect-ratio\"><div class=\"wp-block-embed__wrapper\">\n<iframe title=\"Why Currency Choice Matters as Much as Asset Choice\" width=\"500\" height=\"281\" src=\"https:\/\/www.youtube.com\/embed\/O_HpohWoAFw?feature=oembed\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share\" referrerpolicy=\"strict-origin-when-cross-origin\" allowfullscreen><\/iframe>\n<\/div><\/figure>\n<\/div>\n<\/div>\n\n\n\n<p class=\"wp-block-paragraph\">Trying to forecast where exchange rates will move next ranks among the more thankless exercises in finance, arguably harder than predicting equity markets because it demands getting the relative view right on two economies simultaneously, not just one. A currency\u2019s fate hinges on geopolitics, debt to GDP, inflation trajectories, interest rate differentials, bond yields, and sovereign creditworthiness, all interacting at once and often pulling in different directions. Yet for investors domiciled in countries with historically weaker currencies, ignoring this dimension of portfolio construction is not really an option.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The current picture illustrates why. The Federal Reserve maintained the target range for the federal funds rate at 3.5% to 3.75% at its late July meeting, noting that economic activity is expanding at a solid pace despite elevated uncertainty tied in part to the conflict in the Middle East. A spike in gasoline prices resulting from the war with Iran pushed the annual inflation rate to 4.2% in May, its highest level in more than three years. That combination of firm rates and sticky inflation has kept the dollar attractive on a carry basis even as questions persist about America\u2019s long-term fiscal trajectory.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Meanwhile, the dollar\u2019s dominance in global reserves remains largely intact, even if it is being nibbled at the edges. The share of US dollar holdings decreased to 56.77 percent in 2025Q4, from 56.93 percent in 2025Q3, a gradual drift rather than a collapse. The euro\u2019s share declined to 20.03 percent in 2026Q1, from 20.38 percent in 2025Q4, while the renminbi\u2019s share edged up to 1.99 percent from 1.95 percent. That last figure matters enormously for anyone entertaining the idea that China\u2019s currency is close to displacing the dollar. It isn\u2019t. A currency used by barely 2% of global reserves, issued by a state that controls capital flows and information alike, is not a serious alternative store of wealth for anyone prioritising the preservation of capital over political conviction.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">For investors in Latin America, the calculus around dollar exposure is not academic. Argentina\u2019s national currency has fallen to its weakest level ever against the U.S. dollar, marking another significant milestone in the country\u2019s prolonged economic struggles. The Argentine peso declined to its lowest value ever against the U.S. dollar, extending a long-term trend of depreciation that has significantly reduced the purchasing power of households and businesses across the country. This is not a one-off shock but the latest chapter in a decades-long pattern, and it explains why dollar-denominated assets hold such appeal for savers who have watched their local currency erode repeatedly, regardless of whichever government happens to be in charge.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">It is tempting to assume this is purely an emerging-market concern, but that would be a mistake. Sterling\u2019s recent history offers a useful reminder that G7 status confers no immunity. GBP\/USD rose 6.5% in 2025, but this was driven by U.S. dollar weakness rather than by notable strength in the pound, and the USD index fell 10% across 2025, marking its worst yearly performance since 1979. In other words, sterling\u2019s apparent strength last year said more about dollar softness than pound resilience, and the pound remains exposed to bouts of weakness if political risk rises, growth concerns deepen, or rate expectations move again in the UK. A decade of political churn and lacklustre growth has left the pound a less reliable store of value than it once was, which is precisely why even UK-based investors increasingly look to diversify beyond their home currency.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Switzerland remains the standing counterexample, a small economy punching well above its weight in the wealth management world. Switzerland manages 25% of global cross-border private wealth, totaling CHF 2.4 trillion in early 2026, a concentration built on decades of trust built on political predictability, currency strength, and legal confidentiality. The franc\u2019s low weighting in official reserve statistics disguises just how disproportionately it is trusted by private capital seeking a genuine alternative to the dollar and the euro.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">None of this amounts to a case for abandoning local currency exposure altogether, nor does it suggest the dollar is a risk-free bet given America\u2019s own fiscal strains. But for investors whose home currency has a track record of depreciation, whether that history spans decades in Argentina or merely a difficult decade in the UK, holding a portion of wealth in dollars, francs, or genuinely diversified international instruments is less about chasing yield and more about not putting every unit of purchasing power behind a single government\u2019s promises. Currency risk cannot be timed with any more confidence than equity market timing. It can, however, be diversified, and that distinction is worth acting on rather than debating indefinitely.<\/p>\n\n\n\n<div style=\"height:20px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<div style=\"height:31px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>We would like to thank <a href=\"https:\/\/news.dominion-cs.com\/es\/\" target=\"_blank\" rel=\"noopener\">Dominion Capital Strategies<\/a> <\/strong>for writing this content and sharing it with us.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><em><strong>Sources: <\/strong>Bloomberg, Yahoo Finance, Marketwatch, MSCI. <\/em><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><em><strong>Copyright<\/strong> \u00a9 2023 Dominion Capital Strategies, All rights reserved.<\/em><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><em><strong>Disclaimer: <\/strong>The views expressed in this article are those of the author as of the date of publication and do not necessarily reflect those of <strong>Dominion Capital Strategies Limited<\/strong> or its related companies. The content of this article is not intended to constitute investment advice and will not be updated after publication. Images, videos, literary quotations, and any material that may be subject to copyright are reproduced in whole or in part in this article on the basis of fair dealing, applied to news reporting and journalistic commentary on events.<\/em><\/p>\n\n\n\n<div style=\"height:34px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<div style=\"height:32px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<h4 class=\"wp-block-heading has-text-align-center\">To begin receiving financial advice and learn more about secure investment opportunities in the market<\/h4>\n\n\n\n<div class=\"wp-block-columns is-layout-flex wp-container-core-columns-is-layout-8f761849 wp-block-columns-is-layout-flex\">\n<div class=\"wp-block-column is-layout-flow wp-block-column-is-layout-flow\">\n<div class=\"wp-block-buttons is-content-justification-center is-layout-flex wp-container-core-buttons-is-layout-fe48e5de wp-block-buttons-is-layout-flex\">\n<div class=\"wp-block-button is-style-fill\"><a class=\"wp-block-button__link has-white-color has-text-color has-background wp-element-button\" href=\"https:\/\/kngadvisors.com\/en\/contact-us\/\" style=\"background:linear-gradient(135deg,rgb(0,255,246) 0%,rgb(17,17,61) 90%)\" target=\"_blank\" rel=\"noreferrer noopener\">Contact an advisor<\/a><\/div>\n<\/div>\n<\/div>\n<\/div>\n\n\n\n<p class=\"wp-block-paragraph\"><\/p>","protected":false},"excerpt":{"rendered":"<p>Currency selection: Discover why the currency you invest in can be just as important as the asset you choose when building a resilient and diversified investment portfolio.<\/p>","protected":false},"author":2,"featured_media":14247,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_joinchat":[],"footnotes":""},"categories":[18],"tags":[44],"class_list":["post-14245","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-noticias","tag-mercados-bursatiles"],"_links":{"self":[{"href":"https:\/\/kngadvisors.com\/en\/wp-json\/wp\/v2\/posts\/14245","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/kngadvisors.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/kngadvisors.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/kngadvisors.com\/en\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/kngadvisors.com\/en\/wp-json\/wp\/v2\/comments?post=14245"}],"version-history":[{"count":5,"href":"https:\/\/kngadvisors.com\/en\/wp-json\/wp\/v2\/posts\/14245\/revisions"}],"predecessor-version":[{"id":14251,"href":"https:\/\/kngadvisors.com\/en\/wp-json\/wp\/v2\/posts\/14245\/revisions\/14251"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/kngadvisors.com\/en\/wp-json\/wp\/v2\/media\/14247"}],"wp:attachment":[{"href":"https:\/\/kngadvisors.com\/en\/wp-json\/wp\/v2\/media?parent=14245"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/kngadvisors.com\/en\/wp-json\/wp\/v2\/categories?post=14245"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/kngadvisors.com\/en\/wp-json\/wp\/v2\/tags?post=14245"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}