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Home/ Economics HL - Jacob Solomon's group - Year 1/ Group items tagged Currency

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Lola Z

Emerging markets: One more such victory | The Economist - 0 views

  • grab a bit of extra demand for themselves by weakening their currencies.
    • Lola Z
       
      When the demand for currencies increases, there would be more spending.
    • Lola Z
       
      When the price drops, there will be more demand for the currencies.
    • Lola Z
       
      Imposing taxes and other restrictions on foreign purchases helps to increase the prices of imported goods, so as to decrease the level of demand for the foreign currencies.
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  • it fought back by imposing taxes and other restrictions on foreign purchases of local securities.
    • Lola Z
       
      When the currency of one country is weakened, the prices of imported goods and services will rise. The demand for imported good(in this case, from China) is decreased. The Chinese manufacturers might want to decrease the amount of production.
  • Falling export orders was one of the complaints voiced by Chinese manufacturers in a preliminary survey of purchasing managers published by HSBC last week.
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    This article states the relationship between currencies, which links to prices, and the demand for goods and services. While the currencies are weakened worldwide, the manufacturing industries are highly impacted. Therefore, the supply is lowered.
Lola Z

Richard W. Evans: Punishing China for currency manipulation could hurt the U.S. | Deser... - 1 views

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    It is interesting to receive a totally different perspective on the issue that China keeps its currency artificially low. In this article, it actually says that the benefits to the US of China manipulating its currency far outweighs the costs. The reason is that the consumers get cheaper goods, which are essential goods such as toys and clothes. The other reason is that when the Chinese government is constantly buying dollars to keep Chinese yuan low, it helps to stabilize the price level in the US because the imported goods do not become more expensive, and it also helps to keep the interest rate low. This is beneficial to the US economy.
Monique T

THE RUPEE: all-round decline | Business Recorder - 0 views

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    This article describes the decrease in currency value of the rupee, which the central bank is trying to correct by selling dollars and purchasing their own currency.
Sebastian van Winkel

Switzerland abandons floating exchange rate in dramatic 'currency war' twist - 0 views

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    The Swiss national bank (SNB) said it would "no longer tolerate" a euro rate below 1.20 francs. "The SNB will enforce this minimum rate with the utmost determination and is prepared to buy foreign currency in unlimited quantities. The massive overvaluation of the franc poses an acute threat to the Swiss economy and carries the risk of a deflationary development," it said.
Sebastian van Winkel

They're buying what? U.S. investors latch onto Iraqi dinar - 1 views

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    "It's not a question of if, but when Iraq revalues its currency," said the Las Vegas-based Scarpa, who keeps dinars in his retirement account. "The dinar will eventually have substantial value, possibly the highest in the world." He's not alone in risking his money on an investment that can charitably be described as a long-term turnaround project that will pay off only for the extremely patient. Thousands like Scarpa in America are buying the dinar, hoping someday the war-torn nation can revalue a currency worth just a fraction of a penny.
Katie Edwards

RBA forex holdings grow to help force down value of strong Aussie | The Australian - 1 views

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    The Aussie dollar is very strong, so the Reserve Bank of Australia is trying to gather foreign currency to increase supply, causing the value and demand for Aussie dollar to fall a bit. The RBA doesn't intervene often, but it's necessary now to bring down the strength of the Aussie dollar so that it doesn't continue to lessen the value of exports.
Mirren M

Behind Iran's currency crash - 2 views

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    Excerpt from the article: "Most experts think the fall is a direct result of sanctions designed to get Iran to curtail its nuclear program, which Iranian leaders say is intended to generate nuclear power but many suspect could be used to produce a weapon"
Lola Z

Australia's Current-Account Deficit Widened Last Quarter - Bloomberg - 0 views

  • by 1.5 percentage points since November last year to stimulate industries outside of resources as commodity prices ease. A high currency has hurt earnings for manufacturers and retailers, helping create what the RBA has referred to as a multispeed economy with those industries lagging behind mining companies.
    • Lola Z
       
      Lowering the interest rates means less foreign investment because of the low interest, and hence, the demand for the currency will be lowered as well. The currency value may decrease as a result, and making exports cheaper, reducing the trade deficit.
  • weaker prices for iron ore and coal, the nation’s two biggest commodity exports.
Katie Edwards

Current account deficit widens - 0 views

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    This article explores the causes and outcomes of a rising current account deficit in Australia. The central bank is evaluating different options to try and balance the current account deficit by manipulating imports and exports, as well as adjusting the value of currency.
Lola Z

Forex Flash: Is Eurozone destined to repeat mistakes? â€" Goldman Sachs - 0 views

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    This article talks about the sad outlook of eurozone. Eurozone is an example of monetary union/currency union. We can clearly see that the effects of economic downturn affect different countries to a different degree. Greece, Spain, and Ireland are much more heavily affected than the rest. This is the same as the crisis mentioned in this article as the 70s to 80s crisis. Shocks will affect different countries differently--a shortcoming of monetary union.
Lola Z

Indian Equities: Good Bet On The Global Currency War - Seeking Alpha - 0 views

  • 1. India runs a current account deficit (CAD) with ample room to absorb foreign exchange inflows: Import substitution (high inflation and domestic supply-side bottlenecks), slow growth in services sector, inelastic energy demand and anemic global demand would lead to CAD remaining above sustainable levels in 2013.
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    This article talks about India and its current account deficit. Import substitution is a good way to reduce current account deficit by reducing the import expenditure.
Hannah S

The plan worked - 1 views

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    IT'S election season in America, which means that China is in the rhetorical crosshairs. Both President Obama and Mitt Romney have been complaining about Chinese economic misbehaviour, but Mr Romney has attacked Mr Obama especially viciously on the subject of currency manipulation and the administration's failure to label China a manipulator and slap it with tariffs. The article is tring to decide whether China should have a number of tariffs put on it to try to stop the number of exports or whether it is to late for this action.
Sebastian van Winkel

Higher Production Costs Shift Chinese Manufacturing - 2 views

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    This articles start out by talking about how Chinese support the world with cheap goods. However, prices are expected to go up as Chinese manufacturers run down with higher wages, more expensive raw materials and an growing currency. This article shows the increase of production cost and the effects it will cause, such as: having companies to opt out, or relocating their companies to other countries.
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    For decades, China's factories have supplied the world with cheap goods - from denim jeans to desktop computers. But export prices are expected to go up as Chinese manufacturers are battered by higher wages, more expensive raw materials and an appreciating currency.
Katie Edwards

Foreign exchange market EURUSD: Market Outlook. Nov 1st 2012 - 1 views

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    Unemployment is a huge issue that is coming from the eurozone economic challenges. There is a negative growth, and increasing unemployment rate. Changing the value of currency, and having difficulties stimulating economic growth are contributing to the problem. The economy is slowing down, which inevitably leads to higher unemployment.
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