The broad U.S. dollar index reached an 18-year high this month. That’s bad news for an already-weakened global economy, in the opinion of Krishen Rangasamy from National Bank of Canada. Key quotes “In theory, USD appreciation is a positive development for non-U.S. economies because their exports are suddenly more competitive. But that impact tends to be more than offset by headwinds generated through the financial channel.” “If the cost of financing rises, this will slow lending and borrowing in U.S. dollars, hurting trade volumes. That explains the observed negative correlation between growth in global trade volumes and that of the Broad Dollar index.” “The record amount of USD-denominated debt can turn an appreciating greenback into a major problem. A stronger USD can indeed make it harder for firms to service their dollar credit.” FX Street FX Street FXStreet is the leading independent portal dedicated to the Foreign Exchange (Forex) market. It was launched in 2000 and the portal has always been proud of their unyielding commitment to provide objective and unbiased information, to enable their users to take better and more confident decisions. View All Post By FX Street FXStreet News share Read Next EUR/USD Price Analysis: A test of 1.0570 looks likely FX Street 2 years The broad U.S. dollar index reached an 18-year high this month. That’s bad news for an already-weakened global economy, in the opinion of Krishen Rangasamy from National Bank of Canada. Key quotes “In theory, USD appreciation is a positive development for non-U.S. economies because their exports are suddenly more competitive. But that impact tends to be more than offset by headwinds generated through the financial channel.” “If the cost of financing rises, this will slow lending and borrowing in U.S. dollars, hurting trade volumes. That explains the observed negative correlation between growth in global trade volumes and that of the… Regulated Forex Brokers All Brokers Sponsored Brokers Broker Benefits Min Deposit Score Visit Broker 1 $100T&Cs Apply 0% Commission and No stamp DutyRegulated by US,UK & International StockCopy Successfull Traders 9.8 Visit Site FreeBets Reviews$100Your capital is at risk. 2 T&Cs Apply 9.8 Visit Site FreeBets Reviews$100Your capital is at risk. 3 Recommended Broker $100T&Cs Apply No deposit or withdrawal feesTrade major forex pairs such as EUR/USD with leverage up to 30:1 and tight spreads of 0.9 pips Low $100 minimum deposit to open a trading account 9 Visit Site FreeBets ReviewsYour capital is at risk. 4 T&Cs Apply Visit Site FreeBets ReviewsYour capital is at risk. 5 Recommended Broker $0T&Cs Apply Trade gold, silver, and platinum directly against major currenciesUp to 1:500 leverage for forex trading24/5 customer service by phone and email 9 Visit Site FreeBets ReviewsYour capital is at risk.
