Several emerging market currencies are wallowing at multi-year lows relative to the US dollar, as falling commodity prices and China's equity volatility reverberate through the global economy. In turn, August began with oil prices plunging to multi-months lows.

A few weeks ago, the IMF projected global growth at 3.3 percent in 2015, marginally lower than in 2014. As a result, commodity prices, particularly for oil, took a plunge.

Major advanced economies are just now in the midst of a fragile recovery, while growth in large emerging economies is slowing or contracting. As a result, neither group is likely to accelerate global demand for oil.

Supply forces are struggling as well. As the number of oil drilling rigs in the US rose, the supply glut showed few signs of abating anytime soon. The prospects of a rebound in the second half are weaker and the threat of new lows is elevated.

Until recently, oil prices were recovering. But after rallying earlier in the year, oil plunged nearly 20 percent in July (and briefly fell below US$47 per barrel). In the past, such plunges have often heralded the coming of a bear market.

Since oil is a dollar-denominated commodity, the timing of the impending interest rate hike in the US has had a significant impact on the US dollar and thus on oil prices. Monetary hawks expect the Fed to raise short-term interest rates by September; doves, by December 2015.

Still others, including the IMF, have warned about the adverse impact of premature rate hikes, arguing that the Fed should delay the rate hike until 2016. Many central banks have hiked rates prematurely. However, if the Fed does the same, the implications would be global.