The value of the dollar value to the currency basket has been sharply fell sharply, after the U.S. Government Rating has reduced the U.S. government credit rating.
The dollar index, which shows the value of US towards the six most important world currencies, fell 1.9 percent last week, to 99.10 points.
The euro exchange rate increased by 1.7 percent, to $ 1,1360. The American currency weakened by Japanese, by 2.1 percent, so its price sank to 142.55 yen.
The dollar is under pressure since about ten days ago Moody’s agency reduced the US credit rating with AAA on AA1 due to a large federal budget deficit, high cost of financing and planned tax reduction.
The public debt of the United States is around 36,200 billion dollars, and could increase by another 3,800 billion in the next ten years because the US President Donald Trump intends to reduce taxes. Therefore, they grew significantly to US government bonds, which means that the state must be borrowed at a higher price.
Tax reduction would probably encourage consumption and supported the growth of the economy, but on the other hand, the public debt would increase, if state spending is not reduced.
The dollar pressure is enhanced on Friday, when Trump rejuvenated the markets by the European Union of Customs of 50 percent since 1. June because it is not satisfied with the trade negotiations between the United States and the EU.
(Vijesti.ba)
