Peter Smith, investment director of Federated Hermes, said that the recent outbreak of hostilities in the Middle East region itself explains the decline in American exceptionalism and the decline in the status of the US dollar reserve currency. He added that compared to previous crises in the region, neither US Treasury bonds nor the US dollar strengthened. It can be assumed that after investing trillions of dollars in US assets over the past five years, international investors are now beginning to rebalance their portfolios. Investors are better off continuing to consider opportunities outside of the US, he said.

Peter Smith, investment director of Federated Hermes, said that the recent outbreak of hostilities in the Middle East region itself explains the decline in American exceptionalism and the decline in the status of the US dollar reserve currency. He added that compared to previous crises in the region, neither US Treasury bonds nor the US dollar strengthened. It can be assumed that after investing trillions of dollars in US assets over the past five years, international investors are now beginning to rebalance their portfolios. Investors are better off continuing to consider opportunities outside of the US, he said.