Currently the United States trade deficit (the imbalance between our exports and

Question

Currently the United States trade deficit (the imbalance between our exports and imports) is considered one of the main reason that our currency, the dollar, is falling so rapidly against the Euro, which is at an all time high versus the dollar. Yet despite all this bad news, specific sectors of the US economy does not seem to mind the dollar's slide. Using evidence from at least two (2) of the statistical resources you research on the web, such as the US Census trade statistics or the White House Economic Statistics Briefing Room, explain the following in a 1-2 paragraph response: 1. What are the explanations for the falling dollar?

Explanation / Answer

The main reason behind the falling value of the dollar is the increasing US trade deficit and the larger Federal budget deficit. Most of the economists suggest that the recent fall in the USD is resulted mainly due to increased trade deficit which is a situation where the important exceeds the exports which decrease the demand of UDS in the exchange market.

In the recent data, it is found that U.S. federal budget deficit for the fiscal year 2018 is $440 billion while U.S. trade deficit rose to $43.5 billion in September. Apart from his the provisions of tax cuts, the political tensions with North Korea, the war in Afghanistan and Iraq, all these added up to the lesser confidence in the USD.

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