What effects does a weak dollar have inside and outside the U.S.A?

Résumé du document

The United States dollar is the unit of currency of the United States; it has also been adopted as the official currency of some other countries.
Its value has fluctuated a lot since the creation of the European currency, the Euro, and it has had a lot of consequences in the global economy as well as the economy of the United States of America. We can examine how much the global economy has weakened in view of the huge fluctuations which affected the whole world and especially the Western countries.

Extraits

[...] For instance Thermal North America has been bought out by Veolia and Activision by Vivendi for 18.9 billion USD. Another downside is the rates of poor people. It has increased in the last few years. (According to Echos” 04/10/07). It means that economy is weakened and the low dollar is liable for this raise. In addition, we talked about increasing of tourism of foreign counties in U.S. but we didn't talked about the tourism of American people which travel to Europe. [...]

[...] The US dollar has known on September its lowest exchange rate with the euro, to reach $ 1.5990 per euro, when the highest position of the dollar was on October with a $ 0.8252 per euro rate. The consolidation of Euro as the No.2 world currency made it an important challenger to the US dollar. However, this latter keeps leading on emergent developing countries in Asia or Latin America. In the case of Europe there are quite important effects because of a weak dollar. First of all, raw materials, such as wheat or corn are generally sold in dollars. [...]

[...] Difficulties of a lower dollar However, a weak dollar does also have negative effects outside the U.S.A. In that way, if US exports are going well, imports to the US aren't so. A weaker dollar weighs on European exporters which are forced to raise prices in order to reduce the effect of unfavourable exchange rates. For example, on May the European aircraft constructor Airbus had to raise the price of their aircraft which were priced in dollars. Another problem due to a weak dollar is that a lot of American tourists now don't come to visit Europe because prices in Euro are expensive to them. [...]

[...] We also can add that it is an advantage for exporting because a weak dollar means an advantage in the currency change rate, US products are exported easier. Abroad, it's a benefit for people going to the U.S.A, where they can find lower prices due to the change than in Europe, for instance. However, a weak dollar has also harmful consequences, as vulnerability for US companies, but also the rates of poor people increase. In other regions of the world, some problems can also be found : European companies using dollar as a reference currency are losing benefits, and also the tourism sector which mourns a significant decrease in American tourists. [...]

[...] to take care of those tourists. According to the U.S. Bureau of Economic Analysis (www.bea.gov) In spite of the subprime crisis, which is happening nowadays, U.S.'s economy growth is estimated at a which is quiet high in relation to of the previous quarter. Indeed a weak currency helps to stimulate the growth of the economy in United States. The last positive effect of a soft U.S. currency is that it makes the European imports cheaper and therefore makes manufacturer sells increasing. [...]