Euro to US Dollar
The
exchange rate from the Euro to the dollar has been decreasing lately with the
US dollar growing significantly in strength. Three are many reasons behind this
change and the sea change in currency rates appears to be a lasting change in
the relative value of these currencies that will continue on for some time.
This article will discuss some reasons for the currency rate changes between
the US dollar and Euro and why they are likely to continue for the indefinite
future.
US Dollar Strengthening to the EURO
Weakness in the European economy and growth in the US economy is the basic
reason why the US dollar is strengthening while the Euro is decreasing in
value. Since the United States is more closely controlled than the Euro zone
with one nation and central bank driving the currency policies, the Federal
Reserve has been able to move quicker and with more solidarity than the European
Central Banks can. This provides strength to the dollar and to various policy
movements which have led to improvement in the economy at large.
In addition the United States has better demographics than Europe which has a declining population and large swaths of immigrants who have not been meshing with local populations which have put added pressure on economic growth. The United States has also had a surge in oil production which has driven up economic activity and driven the US economy forward, even in the face of lower gas prices. Finally, the US economy has lower taxes which allows consumers to have more funding that can push consumer spending forward.
In addition the United States has better demographics than Europe which has a declining population and large swaths of immigrants who have not been meshing with local populations which have put added pressure on economic growth. The United States has also had a surge in oil production which has driven up economic activity and driven the US economy forward, even in the face of lower gas prices. Finally, the US economy has lower taxes which allows consumers to have more funding that can push consumer spending forward.
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