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Rathish

Forex market

Question

Bro, USA import more product and services compare to export. Then how USD value always increasing. ?

Edited by Rathish

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Hi Rathish,

The dollar's value keeps rising mainly because of its reserve currency status. Keep in mind that almost everything that is bought or sold in international trade is paid for in dollars. Even powerful countries such as Russia, Japan, and China have to pay for most of their imports using the US dollar, which makes the currency almost a monopoly.

Hence, there is a never ending demand for the dollar by other countries, which is what keeps the currency's value supported, especially in such uncertain times. The powerful position occupied by the dollar means that most investors have faith that its value will never deteriorate given the constant high global demand for the currency, hence, its categorization as a safe-haven currency.

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