What will the dollar increase? Growth of the dollar: forecasts, consequences

Starting from the end of August 2014, the dollar rate began to gain momentum gradually. In parallel, a decline in the cost of oil was recorded. At that time, no one had any idea what the dollar would lead to, which was perceived by the market as another pullback. The disturbances in the society began to intensify when the price chart began to pierce level after level. This phenomenon could be observed since the end of August. It still exists today. The dollar has risen catastrophically in relation to all quoted currencies on the market. A signal to the situation that developed today could be considered the formation of new peaks by the Dow Jones and S & P 500 indices. Many analysts warned since early September that the American currency is preparing a surprise for fundamentalists.

How did the dollar exchange rate affect the life of Russia?

The increase in the value of the US currency, which is considered the most liquid commodity in the world, left its imprint on the economy of every country in the world. The growth of the dollar in Russia was especially bright. The price of oil fell on the situation. The agiotage among citizens in connection with the collapse of the ruble was not supported by the state structures for a long time. The government's mistake was that it relied on self-regulating market forces. The growth of foreign currency, which in the last five months was a spurt, led to a rapid rise in the price of food and to difficulties in business. However, this is only the tip of the iceberg. At the state level, the growth of the dollar rate was a prerequisite for capital outflow from Russia, to reduce imports, to reduce GDP to 0.8%. Not only small and medium-sized enterprises came under attack, but also large concerns, whose activities supplemented the Russian budget. The growth of the dollar, the fall of oil, the emission of the ruble and the reduction in the cost of gas have led to an intensive withering of the Russian economy. At a crisis, the CBR raised the interest rate, which forced the state to take a few steps back in development.

What does the Bank of International Settlement say about the dollar exchange rate?

The question of what will lead to the dollar, worries not only the Russian Federation, but the whole world. The Bank for International Settlements is one of the first financial organizations in the world, which began to sound the alarm in connection with the situation. According to representatives of BIS, the growth of the US currency may lead to a crisis in the economy in many countries of the world. The tendency to strengthen one of the major currencies of the world invariably leads to destabilization of the situation in all stock markets. Fears are primarily due to the fact that large corporations, on the basis of which the economies of the world's states are kept, mainly operate on the basis of loans issued in dollar terms. The repayment of the borrowed amount will have to be made in the same currency, which in the actual course is quite problematic, and in some cases it is impossible. A crisis, similar to what happened in Russia, can be overtaken by more countries in the world.

Debentures

Strengthening the dollar is already automatically becoming a harbinger of trouble for developing countries. Judging about what will lead to the growth of the dollar, it becomes possible only after the currency has reached new historical highs.

As soon as the dollar begins to grow stronger, the governments of countries that are actively developing begin to intensively untie the American currency from their own, which completely deprives themselves of external financing and strengthens the reserves of the Central Banks. At the same time, enterprises of developing countries over the past few years have significantly increased the issuance of debt obligations, and it is in the dollar equivalent. Borrowers have so far issued securities worth about $ 2.6 trillion (3/4 volumes are denominated in dollars). Cross-border loans have reached about $ 4 trillion. If the dominant international currency does not begin to decline, and will continue its procession, the debt burden of many companies in the world will become simply unbearable. The situation will worsen if interest rates in America reach their normal state. And everything goes exactly to this. The policy of quantitative easing has ended, and the US has practically all the trumps in its hands.

A growing dollar: good for the US - bad for the economies of other countries in the world

While the growth of the dollar continues, and the US economy blossoms, things in other countries of the world are far from being the best. For example, in Japan re-recession prevails. Many EU countries are close to the crisis . It is in their territory that the ECB strives to rehabilitate the situation through the introduction of many assistance programs. There were even statements from the government that in the coming months a capital program of quantitative easing is planned. To make the forecast for the future, not one analyst is taking it. According to preliminary estimates, the situation will remain similar in the near future. The first changes can be noticed closer to spring, when the ECB will officially announce about the improvement of economic indicators in connection with the work done.

No optimistic prospects

In the near future, nothing positive from the situation should not wait, especially if we consider the continued growth of the dollar. The consequences are not limited to the increase in demand for currency and its shortage in most countries of the world. It is worth expecting the outflow of capital from the state budget. Large debtor companies will try to repay debts, again borrowing money at high interest rates. In attempts to return the invested funds and get at least a minimum profit, they will introduce a policy of rising prices for all goods and services. Savings of commercial concerns will be carried out by lowering the rate of working personnel. People will become insolvent. It turns out a vicious circle, from which the output is not yet visible. What will the growth of the dollar lead to, in detail no one undertakes to describe, but the fact that the situation will affect everyone is a fact. Under the attack, first and foremost will be states whose policies are aimed at active development.

The return of the dollar at least a third of the path is the most optimistic, but not feasible at this stage forecast.

Is there an opportunity to improve the situation?

To correct the situation in the world is very problematic, as long as the dollar continues to grow. The consequences will continue to increase as the situation continues. The only thing that can somehow unfold the events is an increase in the cost of oil to at least $ 100 per barrel. While the United States is actively producing fuel, and the OPEC countries do not agree to reduce the volume of oil supplies to the international market, nothing will change. The actions of the heads of state can only slightly smooth out the crisis and do little to ease the lives of citizens at the domestic economic level.

Situations that previously were scary to think, today are taken for granted. And the whole blame for the growth of the dollar. Forecasts in the aspect of the active flowering of America already allow to admit the situation when the rate will correspond to 200 rubles for 1 dollar. While the value of the currency is confidently moving to the mark of 100 rubles for one dollar, and society takes the situation for granted. Understanding that America and its successful prosperity, in particular, the active increase of important economic indicators, led to a global depression, does not change anything. And what will result in the growth of the dollar in the end is a mystery.