ECONOMICS 8.docx - Running head VALUE OF A DOLLAR VALUE OF A DOLLAR Affiliation Professor Course Date VALUE OF A DOLLAR Introduction United States has a


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Running head: VALUE OF A DOLLAR VALUE OF A DOLLAR Affiliation Professor Course Date
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VALUE OF A DOLLAR Introduction United States has a highly developed and a mixed economy and it stand to be the largest economy across the globe by nominal Gross Domestic Product (GDP). It is also the second biggest by procuring power parity (PPP). Its economy is geared toward by an ample natural resources, high productivity as well as advanced infrastructure. The American currency, the dollar, is the major currency that is used by numerous countries in carrying out international transaction. Dollar is the leading reserve currency in the world, supported by science and technology within America. A number of countries uses dollar as their approved currency plus other countries which is their de facto currency. (Rivoli, 2014) The exports from United States is aided by the highest value the dollar offers to America. This is because, since 2004 to 2014, the dollar has experienced less fluctuation than Euro. Therefore, Euro has depreciated against the British pound which has resulted to less desirability of United States products and services to Eurozone consumers. The dollar has appreciated due to strong economic performance in the United States. The trend has currently been strengthened because of the weak development and expansionary financial policy within Eurozone. British exports might lose competitiveness within the Eurozone, slowing down the economic growth in United States. On the contrary, importers will gain from inexpensive Eurozone imports. Therefore, to enable the united states stabilize its economy towards the export-controlled growth it should broaden its horizons with its export endpoints. That is, exports continues to primarily reach the Eurozone, but the growth rate of exports to upcoming markets outperforms that to the Eurozone. To enable the united states achieve this it should consider the following major points; Falling euro puts additional pressure on pound
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VALUE OF A DOLLAR To start with, falling euro should put additional pressure on pound. According to a current research done by (Rivoli, 2014), it showed that the United States' economy advanced by 2.6 percent in 2014, which was the greatest rate within G-7, as unemployment drops by 20 percent with 5.7 percent of jobless residents in December 2014. This was the lowermost rate since 2004. Since the beginning of 2014, US has experienced a stable rise in the pound on its strong economic performance. The pound value slowly improved by 20 percent compared to the euro since early 2014 including a 7 percent drop in the mid-2015. The current increases in the value of the pound have been made worse by the performance of the euro. The Eurozone is far much ahead the major export market within US that accounts about 42 percent of export in 2014. Thus, the US dollar is integrally profound to the euro's activities. The currency depreciation is mostly
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  • Spring '08
  • Frandina

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