Why dollar value is decreasing ?

The devaluation of the US Dollar is good for exports of US made products, but it also reflect the recession the USA is going through which is cause due to lose of jobs and lose of homes specially at this period the great numbers of fore closures in addition to the war in Iraq and the US huge federal debts.

because us economy is slow down and us recession and global fectors affecting us dollar.

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Because....(in addition to the postings here ....)

Global economic activities have shifted in the Asian and other emerging markets (India, China and Brazil etc)

When dollar is shifting to fund activities there, their currency(ies) is appreciating resulting in fall of dollar

EURO is more dominant than dollar these days. Unified activities in the EU countries are finding more prospects thus affecting the sentiment for holding dollars

For "War funding" in USA, economy is in problem resulting in inflation and less Govt. funded activities and thus fall of dollars.
Etc. etc.. etc..

In general the weaking effect of Dollar can be contributed by various factors like government, market forces of supply and demand for a particular country's currency, interest rates, inflation, and consumers' expectations about what will happen in the future. At present financial experts seems to point out the feat factor on lot of economical aspects like Housing market crash, consumer slow down, oil price increase being the culprits. They predict that the collapsing dollar will dramatically accelerate U.S. inflation and will pressure upward U.S. long-term interest rates.

In yesterday's news, Financial minister P.Chidambaram commented that "US dollar weaking is really good for India as it benefits India in lot of ways while our trader and exporters are struggling with it. Buying price of oil is little cheaper and also it really slows down our inflation rate".

Is this a Good news for Indians or Bad one for NRI's? I somehow have a mixed feeling on it. May be its a good news as we see Rupee is gaining strength over Dollar. But in lot of ways it really hurts the Indian Export industry and NRI's very importantly.

How does it affect really?

Because of the Dollar value weakening, the buying power of the dollar has gone down and you end up buying less compared to a year back. So exporters who get paid by dollars are seeing crunch in their profit margins. This really makes big impact when you are competiting with other global countries.

On the other instance, NRI's investing back at home will have major set back. For example, past year if you can buy 4.5 lakhs worth of property in just $10000 now it needs $11500, an increase the dollar spend. Similary if an NRI is sending money back home an average $1000 yielded 43,000 rupees after commission but not only yield 39,000 rupees. On average 8% decrease in the yield. I knew lot of NRI's who wanted to take advantage of the high interest rate in India, so converted their money and saved in Indian Banks which also helped India forex. Now with current dollar value reduction, NRI's are losing lot of money on conversion day by day which surely not encouraging the savings idea in India.

Overall, Dollar weakening is really good think for India on a broader outlook but it does truely affects many Indian exporters and NRI's in particular to a large extent. There is a lot of hope that its just a short term trend and should revert back pretty soon as its all part of a cycle.

because rupee value is increased.

Added to all the experts on this issue, the national debt does not help either as it seems America pumps out huge amounts of money to help almost every nation out with no or limited help from other countries. WATCH Ben Bernanke....he dictates all !!!!!

There is another reason that I've read about -- now that the euro is a valid currency for a market of over 450 million people, it is a contender to displace the American dollar as the world's reserve currency.

America has artificially increased the demand for its currency by insisting on paying for oil in dollars, not in the currency of OPEC nations (i.e., not in Saudi riyals or Indonesian rupiah). Foreign investors use those dollars to purchase American securities and other investments around the world. This keeps the dollar in a state of increased circulation and is referred to as "petrodollar recycling."

Since the introduction of the euro, that phenomenon has come under attack, allegedly by the late Saddam Hussein and others. By trading oil in exchange for other currencies, they can dump American dollars on the global currency markets and the value of the USD will plummet compared with other currencies. It may be the real reason the Americans are at war in Iraq -- just read the (long) link below.

Inflation, the US is printing more money, which makes the value go down.

The dollar decreases as the money supply increases. Decreasing interest rates lowers the value of the dollar because it causes an increase in the money supply. The fed is increasing the money supply and easing rates causing an intentional decline in the dollar. They seem to want to ease the housing situation and make it easier for foreigners to buy US products.

1.Euro is frequently used by traders than dollar
2.last year the EU pumped more Euros and it made to decrease the demand for dollar
3.US pumps dollars in same manner to increase the demand for dollar
4.Dollars got trapped in underdeveloping and developing countries as reserves in terms of foreign investment. so the other countries currency value inc.

because the EURO have begi to be used by many americans so thats answer for this qestion

can any one tell when dollar value will go up again

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