The US dollar and its impact on markets

THE US dollar remains a reference point for global trade. Its rise or fall in relative value has significant economic impacts. Countries that peg their currency to the greenback find themselves in thrall to its movements.

Here’s a brief summary of the impacts of US dollar strength or weakness from an American perspective.

A stronger greenback benefits US importers, including those who import goods from China. Mainly, it benefits American foreign products as they become cheaper in US dollar terms. This acts as a damper on inflation.