Foreign currency and macroeconomic analysis on the material currency against the U.S. dollar over the 5-year period ending with 2010.
Imagine studying what is going on with currency in the world today, especially with what is going on outside and within the United States. What will one discover through this research? Has the dollar improved or become worse over the years? By learning various coinage, one is able to grasp ways in which it is affecting the world today for the positive or negative.
In 2010, "the U.S. dollar hit a multi-decade high, with three-year volatility near its highest level in more than three decades" (Fidelity, 2011, para 1). This is quite significant because of how terrible the U.S. dollar is doing in comparison to foreign currency. In fact, other countries are doing better than us. A person cannot avoid this issue because of what is happening macro economically with currency today around the globe (Solomon, 2011).
Exchange-rate movements can significantly influence foreign stock returns to U.S.
Investors, particularly, over short-term periods. A strengthening dollar lowers foreign stock returns to U.S. investors because the return achieved in local foreign currency is worth less when converted into relatively more expensive dollars. Conversely, a weaker dollar typically leads to higher returns for U.S. investors: When the U.S. dollar declines
vs. foreign currencies; foreign stocks that appreciate in local currency are worth more when converted back into cheaper U.S. dollars. Please see the chart below (Fidelity,
2011, para 2).
In order to illustrate this issue, one needs to describe the relationship that is uncorrelated, especially with that of stock and currency movements within the market (Fidelity, 2011). "Austrailian stocks were roughly flat (up just 0.7%) in 2010, but the Aussie currency strengthened signficantly vs. The U.S. dollar" (Fidelity, 2011, para 4). Furthermore, Aussie dollar did manag to have a 14.7% gain; this was after the stocks were exchanged into that of U.S. dollars (Solomon, 2011).
One needs to describe German stock. Theirs managed to rise at least 16.9% locally compared to the U.S. dollar in 2010; however, a weakening did occur, which did result in lower returns of 9.3% for investors in the U.S. This does demonstrate that during any short period that stock prices can move in any direction for the currencies in countries around the globe (Fidelity, 2011).
The "U.S. stocks had a modestly negative correlation (-0.19) versus foreign-exchange movements during the past…
Macroeconomic Analysis Economically, recession is described as a significant drop in economic activity over a short period of time usually a few months (bbc news, 2008). Gross Domestic Product (GDP), household income and other macro-economic indicators drop while others such as unemployment and bankruptcy rises. Recession can be caused by many factors e.g an external trade shock or the burst of an economic bubble such as the United States housing bubble.
Note: current prices values are expressed in AUD billion. Australia's Trade Situation In the June quarter 2007, Australia's exports of goods and services increased by 0.5%, reaching the value of $54.6 billion. This increase follows a series of increases, as for the 2006-2007 financial year, exports increased by 10%, reaching $216 billion. Regarding the volume of Australia's exports of goods and services, it increased by 0.8% in the June quarter of 2007,
Americans receive two to three weeks of paid vacation per year, while Europeans receive between 5 and 7 weeks. In addition, the U.S. has generally 8 paid holidays per year; the comparable figure for Europe is 12 to 18 days (holidays such as Easter and Christmas, plus national days and even the Queen's Birthday in the Netherlands). As a result, Americans average only 10.2 vacation days per year (Zuckerman).
However, aggregate supply always responds, eventually, to demand so aggregate supply will fall as well, until there is a state of equilibrium again. 3. Increasing the amount of deposits that commercial banks must hold with the central bank will diminish the money multiplier, which is the amount of money a bank can create with each dollar of reserves. The money multiplier is determined by the reserve ratio. The higher the reserve
Domestic and External Factors on African Macroeconomic Formulation Domestic and External Factors on African Macroeconomic Formulation Growth, productivity and employment are the most common economic variables to reduce extreme poverty and break poverty trap. Report from World Bank in 2007 revealed that one percent in GDP growth results to 1.3% poverty decline in low-income countries. Moreover, development in the productive capacity leads to reduction in sustainable poverty. With improvement in the economic growth,
(Richter, 2002, p. 126) The Asian currency crisis put a heavy toll on the Asian economic paradigm sweeping across economies of Singapore, Taiwan and Korea. For instance, the implication of the regional crisis on Korea has been acute. It was compelled to approach the IMF for emergency credit and received $57 billion aid package with 7.5% of the Korean employable people without jobs by July 1998. Labor problems surfaced across
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