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U.S Dollar on an all time low
- Published 10/6/2007
A lot of investors showed their concerns on the stock updates on Monday. The US dollar was on an all time low this Monday as compared to the Euro.
It was the biggest decline since the last three years and it can
translate into huge losses as far as the consumer market is concerned.
It is a great worry especially for the US economy.
There are a lot of factors that contribute to the downfall of the dollar, essentially the growing markets in Asia and Europe collectively. The U.S interest rates have a direct impact in the fluctuating dollar value and if the interest rates go down then the investors get lower returns on their investment bonds. Hence it wouldn't be wrong to conclude that the recent decline of the value of the dollar is due to the recent drop in the interest rates.
On the other hand, the other countries use their interest rate policies to keep up the value of their currencies but a most of the countries like to hide behind the dollar value and ride on the back of the US monetary policy. This might turn out to be good and bad depending on the circumstances. The other side of the coin says that the potential decrease in the dollar might attract a lot of foreign investors making it an ideal spot for global investors that might help strengthening the economic activities in the United States, which obviously translates to more jobs and more sales.
There are a lot of factors that contribute to the downfall of the dollar, essentially the growing markets in Asia and Europe collectively. The U.S interest rates have a direct impact in the fluctuating dollar value and if the interest rates go down then the investors get lower returns on their investment bonds. Hence it wouldn't be wrong to conclude that the recent decline of the value of the dollar is due to the recent drop in the interest rates.
On the other hand, the other countries use their interest rate policies to keep up the value of their currencies but a most of the countries like to hide behind the dollar value and ride on the back of the US monetary policy. This might turn out to be good and bad depending on the circumstances. The other side of the coin says that the potential decrease in the dollar might attract a lot of foreign investors making it an ideal spot for global investors that might help strengthening the economic activities in the United States, which obviously translates to more jobs and more sales.
