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Dollar to Fall in 2010—Fed Goes Pro-Dollar in 2011: Lancz

Monday, 11 Oct 2010 | 4:28 PM ET

The dollar continued to fall Monday,after declining more than 8 percent in the previous quarter. How will the weak dollar impact companies when they start to report earnings? Alan Lancz, president of Alan B. Lancz & Associates, shared his outlook.

Dollar Drop Post IMF Meeting
Searching for weak dollar winners, with Vince Farrell, Soleil Securities, and Alan Lancz, Alan B. Lancz & Associates.

“It’s a situation where everyone wants a weaker currency to drive their exports. And with the economies not doing as well as what many expected with this turnaround, that’s a way to fuel growth,” Lancz told CNBC.

“I wouldn’t be surprised if the dollar weakens by year-end as the Fed changes their chatter, [but] into 2011, they actually become pro-U.S. dollar to avoid speculation in commodities and the likes.”

Lancz said he also expects interest rates and inflation to start ticking up in 2011 and 2012.

“Less money will go into fixed income and that’s going to fuel the U.S. and international stocks to continue to move up,” he said. “But it is a precarious situation where if you get too much weakness, the whole valuation might be discounted, so investors have to be careful, especially through the year-end.”

Lancz’s Picks:

Hudson City Banc

People’s United

Medtronic

Monsanto

Roche Holdings ADR

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Scorecard—What He Said:

  • Lancz's Previous Appearance on CNBC (Sept. 29, 2010)

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More Market Analysis:

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CNBC Data Pages:

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CNBC Slideshows:

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Disclosures:

No immediate information was available for Lancz or his firm.

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Disclaimer

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