The Economy of the United States
The economy of United States of America is one of the largest among the single nation which is also called as great ol’ USA on the earth. Among the most active currency in foreign exchange market, Dollar which is the currency of US is the most popular currency which makes US one of the largest economies in the world.
Stats Of The United States
The gross domestic product of the US economy is about $14 trillion which is in terms of every year which is worth to make about 25% of services and goods produced every year in the whole nation. Neibouring countries such as Mexico and Canada are the trade partners that make the economy of US moving by supplying oil. Some of the countries which imports sources to the US are:
Most of the raw materials and other sources of business are imported mostly by the United States for the growth of its business in the world. Most of the sources such as capital goods for business operation, consumer goods, industrial supplies and automotive parts are imported. And some of the exporting partners of the United States are:
Some of the exporting goods which are leading in the United States includes airplanes, communication equipment and software and automobiles. Mid west US is also one of the leading producer of farm products and provider of agriculture that supports other parts of the world.
Wealth Of The US
Among the most productive workers in the world that generate high income of about $46,000, which is in per capita income, workers of US are also among them.
US economy is make up by majority in services which include knowledge work than the labor work. Most of the services include engineering, medical services, financial service and other services which are technical.
Monetary Policy Of The US
The monetary policy of United States is managed by the central bank of US and the Federal Reserve. A charter that includes two processes also known as “dual mandate” is managed by the Fed to protect against the inflation of US dollar along with promoting its economic growth.
The information about the Federal Open Market Committee or the FOMC can be received by those careful watchers of the Fed Policy.
Value of US Dollar
Being the most active and popular currency in the foreign exchange market the US dollars possess some quality and character that there is always seller and buyer of this currency and most of the forex trader looks for liquidity as US being the largest economy. The currency of US which is known as dollars can be sold anytime when needed. So the owners of the currency can clear their debts or change for some other currencies.
Market Importance – the only currency that can trade for oil in the world is the US dollar. Oils are extensively sold and also produced every day about 80 millions of oil barrels and therefore in order to buy oils buyers need to have dollars as there are demand to buy oils which are needed for automobiles, trains and planes.
Economic and Fundamental Status
The following items helps in making the value of the dollar to its maximum extent therefore the US dollars traders need to take care of the news items:
Non-farm payroll report – for every month the rate of exchange in Non-farm payroll report or NFP is reported every first Friday. The forex markets are send wild for every release. For every recession and economic growth employment is the most important key factor and the affect in US dollars pairs and global economics depends on the NFP and these are handled by the traders.
Retail Sales – for every month 70% consumption of the US economy and retail sales are recorded which shows the US consumption economy and strength. Weak economy and strong economy are indicated by weak numbers and strong numbers.
FOMC – businesses and forex traders gradually watched the meeting of FOMC of Federal Reserve officials around the whole nation. Action on monetary plans and policies are decided by the Fed meets every month for reporting the decisions to the dollar holders.
Consumer Price Index – change in the consumer prices for every product where there is regularity in buying are measured by the CPI. Rise and fall in the inflation rate will be provided by the CPI to the traders known as inflation index.
US Dollar and its Movement
There are also some items that help in the movement of the currency value in the foreign exchange market. Among the items that are included in the movement are as follows:
Interest rates – interest rates policy are set by the Federal Reserve. Investors can usually borrow in terms of dollar and they can invest anywhere for their business and for other currencies if the rate of the currency is lower in US than the other nation. And investors can invest funds in US if rates are higher in US. The rise and fall in the dollar value is indicated by low rates and high rates.