A turning point for the dollar is coming

Quick Summary:

Namely, the dollar will have to appreciate to shift some of that spending back towards imports, which are in more elastic supply.

Even if a one-time increase in tariff rates leads only to a one-time increase in prices, the Federal Reserve has learned that households dislike one-time increases in prices as much as ongoing inflation.

It will require yet more dollar appreciation to shift a portion of that spending towards foreign supplies.

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Article Details

Author / Journalist: Barry Eichengreen

Category: MarketsFinanceInvesting

Markets: United StatesCanadaChinaMalaysiaMexicoVietnam

Topics: Foreign Spending Financial Markets Inflation Chinese Dollar Shift Cent Social Trump

Source Website Secure: Yes (HTTPS)

News Sentiment: Negative

Fact Checked: Legitimate

Article Type: News Report

Published On: 2024-12-04 @ 05:01:00 (1 days ago)

News Timezone: GMT -5:00

News Source URL: ft.com

Language: English

Article Length: 825 words

Reading Time: 5 minutes read

Sentences: 31 lines

Sentence Length: 27 words per sentence (average)

Platforms: Desktop Web, Mobile Web, iOS App, Android App

Copyright Owner: © Financial Times

News ID: 24112493

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About Financial Times

Main Topics: MarketsFinanceInvesting

Official Website: ft.com

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Year Established: 1888

Headquarters: United States

News Last Updated: 13 hours ago

Coverage Areas: United States

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