Exchange rate and economic activity
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Exchange rate and economic activity

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The dollar is the currency that the world has as a reference for all transaction types. The exchange rate and economic activity is a major economic variables where the government intervenes to set the course of the economic model. In recent years the dollar has been neglected compared to other international currencies such as euro, sterling and Brazilian real, which have been climbing in the world of currencies. The devaluation of the dollar in recent years formed part of a state policy based on fiscal imbalances accommodate to make it more competitive local production and thus the products can be purchased abroad at a lower cost and thus stabilize the trade balance.

Today, with global economic activity on the brink of recession many experts are asking: what happens with the exchange rate if the U.S. economic activity is reactivated? The hypothesis seems unlikely in the short term because of U.S. government efforts to revive the economy so far have failed. The world's stock markets are collapsing despite a coordinated rescue plan between the U.S. and Europe. France so far this year registered a GDP decline of 0.3% in the second quarter and 0.1% in the third quarter, according to projections by the Bank of France confirms that one of the major exchange rate and economic activityof the eurozone is in recession.

What happens to theexchange rate and economic activityif the U.S. economic activity is reactivated? It's a question many ask but apparently the economic recovery now depends not only on the exchange rate change if not coordinate a global strategy between the great powers. The results obtained so far with the bailouts announced at the big banks have not had the desired result, however there will have to wait. What happens to the exchange rate if the U.S. economic activity is reactivated?

Exchange rate and economic activity.To this point it may happen in the future with the kind of change is not something that reveals the Americans. By this time the fall of Wall Street and bank bailout announced by the U.S. government is what most worries the authorities, who on Wednesday October 15 despite the announcements made on Wall Street were down by 8% exceeded drop in two decades, after being made known data on retail sales showed a fall in consumption of 1.2%

The reality is that the American people the loss of confidence is worrisome and what happens to theexchange rate and economic activityif the U.S. economic activity is reactivated, it matters little. What today is that without substantial banks no credit and no credit no consumption at both the U.S. GDP shrinks that is formed as 70% of it consists of the consumption society.

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