Trade Resources Economy The Exchange Rate of Dollars & U.S. Economy

The Exchange Rate of Dollars & U.S. Economy

Many economists are saying that the U.S. will once again be the driving force behind world growth in 2015 as the dollar growth. The U.S. economy saw an annual expansion rate of 5 percent in the third quarter of 2014, according to government data.This is the swiftest of any quarter since 2003. President Obamathe said,the U.S. economy is back.  

The stronger dollar gives U.S. investors more reasons to keep their cash close to home. Some U.S. companies that import most of their materials from abroad may find that those supplies are now cheaper thanks to the currency changes, says Keith Lerner.The company saved in production costs because it mines much of its materials from Australia.

Still, the stronger dollar isn’t always good news for U.S. companies.The knee-jerk reaction to a stronger dollar might be to worry about stocks. After all, a stronger dollar makes U.S. exports more expensive to foreign buyers. But as the table above shows, stocks don’t necessarily suffer as the currency rises.Even in the era of the strong dollar, high demand equals higher prices.

Source:
Contribute Copyright Policy
Topics: Service