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Seems like everything is going to become more expensive. Will that further depreciate the US dollar?
by tartoran 2y ago
Seems like everything is going to become more expensive. Will that further depreciate the US dollar?
- taylodl 2y agoDollar valuation is complex, as it too is subject to the laws of supply and demand. In the short-term, tariffs can paradoxically increase the value of the dollar as more dollars are needed (demand) to pay the tariff. Things get a little more difficult in the long-term. Tariffs disrupt trade and money flows. If that disruption causes the US to be seen as a safe haven for investments, then the demand for US dollars increases and so does its value. Otherwise, if people start pulling out of investments in the US, then the demand for US dollars decreases and so does its value. It really depends on the impact of the tariffs on the global community's willingness to invest in the US once the tariffs are in place.
- tartoran 2y agoThanks. It is indeed complex and unpredictable.