Currency moves by institutional investors are suggesting that precious little attention is being paid to fundamental economics at the moment while the search for yield remains paramount.
Looking at a basket of 20 developed and emerging market currencies, State Street Global Markets notes that buying the three highest yielding and selling the three lowest over the past three months would have gained an investor 2.2 percent.
Over the same period, however, following the fundamental route of eschewing the three currencies with the worst current account balances and buying the three with the best would have lost 4.1 percent.
"It's the economy, stupid, is not a maxim that is currently resonating with investors," State Street said.
The implications of this are twofold. First, "carry" - borrowing in low-yielding currencies to invest in high-yielding ones - appears to be back with a vengeance.
It was not always clear that this would be the case. Fears for global liquidity sent jitters across financial markets earlier this year as central banks across the world tightened monetary policy. But since then, despite hikes in the United States, Japan, and the eurozone investors have relaxed and liquidity remains plentiful. In part, it is feeding the global equity rally.
The second implication is that currency investors are pretty composed when it comes to the future for interest rates. They see the United States on hold and European and Japanese rates unlikely to rise enough to disrupt things. "It will not necessarily change the interest rate differential," Thanos Papasavvas, head of currency management at Investec Asset Management, said of future monetary moves.
This goes some way towards explaining the negligible foreign exchange volatility around at the moment and would tend to argue that few are preparing for nasty surprises.
One does not have to look far to see that current account balances are not having much effect on investment patterns.
The dollar has risen more than 3.5 percent against a basket of currencies since hitting a low in May, despite a current account deficit at 6.6 percent of Gross Domestic Product.
Many investors and economists have argued that the US deficit is unsustainable and must be rectified by a declining currency. But they have been wrong-footed by demand for yield. "The overwhelmingly popular view in the past two years that `a big US C/A deficit equals a dollar crash' has turned out to be very wrong and a very costly bet," Stephen Jen, global head of currency research at Morgan Stanley, said in a note.
Conversely, the Japanese yen has stubbornly remained weak despite an interest rate hike and a huge current account surplus suggesting it should strengthen. "We continue to be wrong on USD/JPY," American Express Bank admitted in its currency outlook earlier this month, adding that it still expected the yen to firm.
The dollar is up around 2.4 percent against the yen over the past three months, while the euro hit a record high against the Japanese currency in late August.
The low-yielding yen - and others such as the Swiss franc - is weak because it's being sold by investors who are buying and thus strengthening higher yielding currencies, including the dollar. Goldman Sachs calls it "the power of carry".
All this begs the question about when - or if - the power will fade and fundamentals will make a comeback.
Investec's Papasavvas reckons it will take strong continuing economic growth in the United States and growth in demand for commodities to shift investor currency patterns. In other words, more tightening by central banks. "If you see general liquidity tightening then the currencies with poor fundamentals are going to be hit most," he said.
Morgan Stanley's Jen reckons other factors are at play as well as the search for yield - notably a move into the safe haven dollar ahead of an expected US-led global slowdown.
So he sees the unwinding of current positions coming when it becomes apparent that the US economy is going to land softly and the rest of the world is staying in good shape. But the case is sometimes made that current account imbalances rarely impact actual flows and that it's only when monetary authorities get worried about them that markets move. South Africa's central bank chief, Tito Mboweni, may have proved the point on Monday when he warned that investor concern about his country's current account deficit - 6.1 percent of GDP - throated the exchange rate and ultimately inflation. The rand dived nearly 2 percent against the dollar.