What make the US dollar strong against other currencies?


What make the US dollar strong against other currencies?

In: 3

The dollar is the standard currency for buying oil. Every nation needs to have dollars to purchase its oil supplies. Since countries/companies need dollars for oil there is a larger demand for the currency thereby increasing its value.

The market.

Foreign currencies are traded in a marketplace, where buyers bid to buy currencies with other currencies. The market makes transactions when a buyer and a seller can agree, and analyzes the transactions that go through to report exchange rates.

There is no “Mr. Big” making decisions in a smoke-filled room. It’s just the results of many individual transactions.

Assuming you are referring to recent events…

There is severe inflation going on in the USA now which is driving speculation that interest rates will rise thus increasing the value of the dollar and that there will be profitable treasury bonds to buy.

We have the largest GDP in the world and set the pace for the global economy. Our combined assets + yearly GDP allows us to guarantee our currency based on faith.

The dollar will always be king, and if the dollar is doing crap, all other currencies will be just as bad

America actually hasn’t had a revolution or a major coup since 1860. We got thru the two world wars relatively unscathed. My nation is relatively stable. So the theory is American currency and more importantly debt are safe.