Exchange Rates Influence You In Different Ways

Food Stuff

The strong dollar can make imports cheaper, which reduces inflation and cost of living. It allows everyone to buy more with the same amount of money. On the other hand, if the dollar’s value reduces, import prices go higher. You must buy groceries at the more expensive price, especially imported products. Unfortunately, this could lead to inflation.

Gas

When the dollar rises in value against other currencies, the price of gas will decrease. More than 70% gas price depends on the oil price. Oil contracts are sold in US dollar. Saudi Arabia sells most of the world’s oil. When the dollar rises, Saudi Arabia’s imports will become cheaper.

Stock Market

Stock market gets advantage and disadvantage from the dollar’s rise. When the dollar is strong, investors buy more dollars. That means they invest more in American enterprises through the stock market. Nonetheless, the strong dollar can make stocks too expensive for foreign investors. When the dollar price falls, investors who have foreign stocks will have more asset.

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