US Exchange Rate (October 31st)

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US Exchange Rate (October 31st)

Japan has announced that it will intervene in the currency exchange market to curb the appreciation of the Japanese Yen (by buying US dollars) until it is satisfied with the results.

This upward pressure on the US dollar will push prices of commodities down for as long as Japan continues to intervene. Furthermore, European Debt concerns have been renewed, which further pushes demand for the US dollar as a safe haven currency.

To recap on the economics, an increase in the value of the US dollar, means that US goods are more expensive for the rest of the world to buy, so producers must decrease prices to adjust for this effect on the dollar.

YaoChuChen19:45, 31 October 2011