The current appetite for the dollar is driven by the belief that US economic growth is rebounding and Europe is doing the opposite. The first may be true — but the second is almost certainly not.

Yet it’s a view that has pushed the dollar index up 3 per cent from the levels of a month ago, though the currency remains 7 per cent weaker than it was at the beginning of 2017.

The dollar may have a little further to climb in the short term, given investors spent more than a year selling it. But for this to be the beginning of a major dollar recovery that returns it to 2015 or 2016 levels, investors must convince themselves that US real rates, or those adjusted for inflation, are structurally higher than most thought. If this emerges — and it is not overwhelmed by domestic and global political risks — the US will deliver what global investors want: sustainably higher real rates of return.