According to Jinshi, Allianz Chief Economic Advisor El-Erian said that policymakers around the world are struggling to deal with the surge in the US dollar and high interest rates in the United States. He said: "Authorities around the world are a little overwhelmed about how to deal with the overall strength of the US dollar." He added that a typical example of inaction is that the yen has fallen below the 154 mark this year, but this move has not yet triggered official intervention.
He also said that the probability of the Fed raising interest rates is low, but not zero. El-Erian believes that the global economy has also proved to be resilient, but industries with "imbalanced" balance sheets (such as some regional banks) and countries with "unsustainable" debt are most vulnerable to tightening financial conditions. He said: "Right now, the distribution of growth engines around the world is very uneven. We will see quite a lot of divergence, not only in policy, but also in results."