If multiple countries share a currency and one country experiences high inflation, how are the other countries affected?

Question

I’m thinking mainly of the US dollar. Is the inflation rate in the US reflected in other countries which use the dollar or which have currencies pegged to the dollar?

Is this different in the EU, where no one country emits the shared currency?

In: 5

Answer 1

I read the other 2 comments before me and I think there is one thing that needs to be clarified: inflation (prices going up somewhere) does not automatically translates into currency depreciation (weaker exchange rate of the USD, for instance). Yes, too much inflation can lead to currency depreciation, but it’s not a direct and immediate cause-effect relationship. Countries pegged to the USD would most likely experience inflation as a consequence of USD depreciation and the cost of imported goods going up.