The current high value of the Euro against the dollar has been on the cards. It was suspected this may happen and shows a further weakening of the US economic climate. Only last week the US Federal Reserve reduced interest rates from by 0.5% to 4.75% and there is now the feeling that it may have to cut rates even more, especially if house sales continue to drop.
It may sound like it’s a good thing, but one party who aren’t rejoicing are the European exporters. The increased value of the Euro to the $ means that their products will cost more when bought in the US and this might cause a slump in sales.
The US are really experiencing a gloomy time at the moment and public confidence in the financial and housing markets is at an all time low. It makes our recent problems with the finance and housing markets pale in comparison.
Read more at BBC News
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