Quote:
Originally Posted by bombadillo
No. The EC produces a trade surplus (modest, I think, but a surplus nonetheless). Ultimately what has been driving the dollar down has been the United States' sustained trade deficits. In a nutshell, the USD has been living beyond its means for decades, and financing its consumption by giving foreigners pieces of paper (dollar currency or US Treasury debt). Europe maintains its house better than the US.
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In fact, it's the huge inbalance in the US trade that drives Dollar low not only towards Euro but also Pound, Canadian and Australian dollar...
However major part of US treasury bonds are held by Central bank of China: in a way China buy dollars so the americans can buy cheap chinese products, european economy is nearly decoupled form the american one: only 7% of the euro-zone trade volume goes on the US...