June 16, 2022
According to the Wall Street Journal, the dollar has strengthened against other currencies this year. As of May 16, the dollar index rose:
Having a strong dollar isn’t always a good thing. It makes our exports more expensive. On the other hand, it makes imports less expensive which is a good thing during an inflationary period.
One of the reasons for the strong dollar is the interest on the treasury bonds is higher than other countries making it attractive to foreign investors.
Other reasons for the strong dollar include:
If the dollar remains strong, it is one of the variables reviewed by the Fed in favor of slowing interest rate increases.
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