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Why USD news affecting other currency?

Discussion in 'Beginners Bootcamp' started by Azlan00IM, Jul 2, 2015.

  1. EURUSD

    EURUSD Sergeant Major

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    Yes usd still become like as standart exchange to measure any goods value, this still used on international economny and many trader traded this pair, but now there are another option like as euro and rub on certain payment processor but still usd more preferable
     
  2. dianajs

    dianajs Private, 1st Class

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    It's called a "global economy" for a reason. Most currencies out there are highly interconnected. The USA has one of the leading economies in the world, it's natural that whatever affects said economy and its currency would have ripple effect on everything else.
     
  3. ForexVerified

    ForexVerified Private, 1st Class

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    And the USD is the major reserve currency for almost all countries in the world.
     
  4. BaibarsB

    BaibarsB FiboGroup Multi

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    how did it happen that USD became so powerfull? When was that moment when all the currencies started to depend on USD? does someone know the historical facts or smth like this?
     
  5. dianajs

    dianajs Private, 1st Class

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    There is that as well. That is why it's good to always follow the news that affect the US dollar, even if you're not trading USD-related currency pairs at the moment.
     
  6. ForexVerified

    ForexVerified Private, 1st Class

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    Yes, following the USD is a must for every trader (you can keep an eye on the dolar index for the general idea of USD movement).
    But unfortunately for us, traders, when a country decides to sell/buy USD we see spikes or short term moves in USD pairs and we have no idea why it happened.
     
  7. EuroTrader

    EuroTrader Sergeant Major

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    Whenever we are doing our trades we have to know that in our trades if the income is good then only we will become happy and so for our trades the knowledge of USD becomes more important to us :)
     
  8. Desacete

    Desacete Recruit

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    The fundamental analysis is a delicate thing. USD news affects dollar as well as other currencies due to correlation (ecenomic relations) between currencies.
     
  9. bigdolly

    bigdolly Sergeant Major

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    Yes because they trade in pairs and are quoted in each other. This is the simple reason.
     
  10. William Barnes

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    Forex is a global platform and here currency exchange rate is the foundation of each trade. Again exchange rate of a currency pair is subject to various global economic factors as well as the national economies of the individual countries. However; with the digitization of financial market; world is becoming smaller and each country's economy is greatly dependent and connected with other countries' economic changes. Again; USD is one of the most widely used reserve currencies and most of the multinational trades are converted and exchanged in USD.

    And USA being a prominent and influential nation; its economy and currency value have significant impact on other countries’ economies. I hope you are getting my point why your trading decision is influenced by the value of USD.
     

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