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Saturday 16 September 2017

Why the dollar will rise? (2)

For most of last year, the dollar and raw materials were moving in the same direction. This means that the dollar was weakening, but raw materials were cheaper. An example is the sharp oil depreciation.
In fact, the US currency is weak compared to the rest of the world. Compared to the euro, the dollar has fallen by 14% since the beginning of the year. 9.8% against the Canadian dollar, 8.1% against the British pound and 16% against the Japanese yen.
So it can be stated that something is happening in the US, which makes the dollar weaken.
And the answer to the question - what makes the dollar cheaper is simple. Fed interest policy.
Although the Fed raised its interest rates twice this year, against the background of its twofold increase over the previous two years, the reserve is expected to be much less aggressive in the future.

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