3 Reasons the US Dollar Is Losing Value — and Why It Might Be Good for Your Wallet

A long time ago, US dollars have been recognized as an important currency around the world, but there have been increasing concerns this year that it might lose value.

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According to Jp Morgan, “The US dollar is the world’s primary currency in the world, and it is also the most used currency for trade and other international transactions. However, its domination has become a question of question recently due to geopolitical and geographical transformations.”

Specifically, JP Morgan noticed some of the reasons why the US dollar loses value. He pointed to the following reasons for the cancellation of fading, which is the significant decrease in the use of the dollar in commercial transactions and global stove:

• In the area of ​​goods, energy transactions are often priced in non -USD currencies.

• American banks do not participate in the new payment systems used in the cross -border deals.

• The dollar’s share of FX reserves has decreased, which is a common use measure of the importance of the dollar.

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Some financial experts who spoke to GoBankingches said that there are some ways in which the value of the US dollar loss may be a good thing for the regular American portfolio.

Anne Cole, Ed, the money coach and founder of Money Essentials for women, said to think about this way: Imagine that the US dollar is equally linked to the European currency – the euro. Suddenly, the US dollar weakens, making European companies more likely to buy American goods through European goods.

Cole said that this starts a course of foreign countries that buy American goods, and leads to the injection of the American economy with external funds, which may create the increasing demand for American goods and perhaps create more American jobs.

“Here is what I told my client – the weakest dollar usually means stronger stock market returns. My wallet analysis shows that when the dollar decreases by 10 %, the companies in the S&P 500 are often witnessing a leap of profits 15 to 20 % due to excessive download.”

Finally, Lokenauth added that inflation from the weak dollar can benefit homeowners with a stable rate. According to him, the annual inflation rate of 5 % gives the home owner a 5 % discount on the mortgage balance in real terms.

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This article was originally appeared on Gobankingraates.com: JP Morgan: 3 reasons the US dollar is losing value – and why it might be useful for your wallet