The US Dollar Outlook: DXY Struggles As Federal Reserve Calls for Fiscal Stimulus is the latest economic news story that we’ve heard lately. But what is the big deal?
We all know that the economic news is always bad when it comes to the US Dollar Outlook. That’s because the US Dollar continues to be overvalued. The Federal Reserve will continue to increase interest rates. The US Dollar is still expected to fall further in value against other major currencies in the future.
What we don’t realize is that the US Dollar Outlook is often more about how you look at the economy rather than the reality of the economy itself. The US Dollar Outlook has been a mainstay of economic news since World War II. In fact, if you have a calculator in your pocket right now, it can probably keep track of the inflation that is sweeping across America right now.
In any case, the US Dollar Outlook is not as important as many would like to think. It doesn’t matter how your calculator is doing on average. What really matters is the state of the economy in terms of your personal finances and whether or not the Federal Reserve is able to do anything about it.
Unfortunately, DXY struggles are also likely to keep the economy from being able to get back on track. This is despite the Federal Reserve having been willing to provide additional stimulus in order to prevent a depression in the United States. You see, the Federal Reserve doesn’t want to see too many defaults in the banking industry.
While the Bank of America’s acquisition of Wachovia has helped to stabilize the FX market in some circles, it will be the continued bad decisions by DXY that will really cause a lot of problems in the long run. When you combine this with a weak economy in the US and the rising inflation rate, it can become a very difficult situation for the economy to deal with.
So, it is understandable why there is a US Dollar Outlook on DXY. The US Dollar Outlook is an indicator of where the economy is headed. If the economy starts to falter, the US Dollar Outlook will probably show you that things will get worse before they get better.
This is not to say that you should completely write off DXY just yet. It is important to remember that the US Dollar Outlook is mostly driven by your expectations of how the economy will respond. when it comes to the Federal Reserve and its plans to boost up the US economy.
In fact, the Central Bank’s efforts to keep the unemployment rate low are not as important as you may think. There are a few reasons for this. First, most economists agree that the current unemployment rate is a result of a weak economy in the first place. Second, the Federal Reserve will not be able to help by printing more money to stimulate up the economy when a major recession or disaster strikes.
There are some things that the Federal Reserve can do to help lower the jobless rate. such as raising interest rates, allowing banks more flexibility to loan out money and allowing them to borrow money from other countries.
Unfortunately, there are no real changes that can happen before the end of this year in the way that the US Dollar Outlook will be heading. There is only one thing that is certain at this point. DXY will continue to struggle.
With more bad economic news coming in, the outlook on the currency is going to be tougher than ever before. As mentioned before, this will not be good for the US dollar. However, if you use some common sense, you can make sure that you are doing the best that you can to protect yourself from this crisis before it takes hold.