For the American travelers, I think the time is now to travel overseas!
Quote:
The U.S. Dollar Index, which measures the value of the greenback against a basket of foreign currencies, has climbed to its highest level in over four years.
"The momentum of the dollar's advance is unprecedented," said analysts at Société Générale in a note Monday morning.
The dollar has long been the world's top business currency and viewed as a "safe bet" among investors. But the recent run up is partly because traders believe the American economy is improving, especially relative to other parts of the world. This will compel the Federal Reserve to raise interest rates, which is generally seen as a good thing for a country's currency.
At the same time, things aren't looking too good in Europe, so the European Central Bank is starting to do some stimulating of its own. Those measures have resulted in a weaker Euro. The Japanese Yen has also struggled because of the country's ongoing economic problems.
The dollar trend is likely to continue, economists from Capital Economics claim. They expect the dollar "to appreciate further as the monetary policy of the Fed diverges from that of central banks elsewhere."
They predict that one euro will be worth $1.15 by the end of 2016, compared with around $1.27 now. The dollar has already gained more than 8% against the Euro in the past six months. (August 29, 2014)
So for the American Viners, how is this reversal of fortune going to affect your future plans?
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