"Dollar’s Rise Spells Trouble for Global Economies"
By Chelsey Dulaney, 09/18/2022
The dollar is the primary currency in the world and interest rates are going up. The Federal Reserve has announced a .75 percentage point increase on to be enacted on Wednesday. With the dollar rising so fast in relation to other currencies, there have been many adverse effects on world markets such as exacerbating Japan's trade deficit, Sri Lanka's food and fuel shortage, and Europe's record inflation. One dollar can buy more than 7 Chinese yuan for the first time since 2020. According to the article, U.S. inflation still remains 'stubbornly high' which encourages the fed to keep raising interest rates. With higher interest rates, investors are pulling money from other currencies and instead investing in U.S. dollars, leading to an even stronger dollar. For the U.S., this is good news because it means cheaper imports. However, the article mentions it could be a 'double edged sword' for the U.S.
Gabriel Ham 09/19/2022
https://www.wsj.com/articles/dollars-rise-spells-trouble-for-global-economies-11663437428
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