4 ms·

Some were and some weren't. Which currencies appreciated significantly against USD in this period? Come to think of it, the UK didn't. It borrowed instead. Why

• gottorf 2y ago
  > Which currencies appreciated significantly against USD in this period? Very few did. A quick snapshot is the Dollar Index, which is a basket of six "major" currencies (pound sterling, yen, Euro, Swiss franc, Canadian dollar, and Swedish krona), which remains higher (stronger dollar) today than even the Covid crash peak, during which basically everything that could be traded did so in a huge range due to extreme market volatility. The Swiss franc is stronger against the dollar since 2019, and so is the Mexican peso, both by roughly 9-10%. That's about it for what I can think of in terms of globally relevant currencies. Most everything else is weaker against the USD than back in 2019. The US dollar, by virtue of being the global reserve currency, can likely absorb more abuse than others. It's often called the cleanest shirt in a pile of dirty laundry. > the UK didn't. It borrowed instead. Why didn't GBP massively increase against USD? It looks like the UK spent roughly ~5k per capita as a response to Covid[0]. When the spending comes from budgetary deficits (that is, absent a commensurate increase in taxes) financed by new bond issuance ("borrowed", as you said), and a large part of said bonds were absorbed by the central bank[1], it's effectively printing money. [0]: https://commonslibrary.parliament.uk/research-briefings/cbp-9309/ https://commonslibrary.parliament.uk/research-briefings/cbp-... [1]: https://tradingeconomics.com/united-kingdom/central-bank-balance-sheet https://tradingeconomics.com/united-kingdom/central-bank-bal...