US Dollar, Euro, British Pound, Indian Rupee, Pakistani Rupee and Chinese Renminbi compared with other currencies

Currency Trends in Emerging Countries: 2016 Monthly Report

The dollar has further risen in December against a series of currencies, even ending 2016 at a sharply higher level than the Chinese yuan, the Mexican peso and the Turkish lira. The fall of the euro and the pound already experienced in 2016 could continue in 2017 amid stronger volatility on the currency market. Our monthly statistical report covers the past two years and displays a comprehensive view of currency values against the US dollar but also v. the euro, the British pound, the Indian and Pak rupees, and the Chinese renminbi over a 2-year period.

The US dollar has continued rising against a large number of currencies in December, in line with a new rise of the benchmark interest rate in the United States.

If the Brazilian real has surged 5.2% in the last month of 2016, the Turkish lira has further lost 2.7% and the Sri Lankan rupee has declined 1.3%.

The American currency could further rise in the first months of 2017 over a new rise of short-term interest rates and prospects of a stronger economic growth in the United States, as president Trump expands public spending through an ambitious infrastructure program.

Currency volatility rebounds

Mostly due to a series of political events, volatility has surged on currency markets in the last months of 2016 and is expected further disrupting business plans in 2017.

Looming elections in France and Germany are expected further depressing the euro whereas the Sterling will remain very weak over unclear Brexit prospects.

The European Central Bank could further implement stimulative measures in order to revamp economic growth whereas the Bank of England will have to take similar decisions.

Finally, the rise of the US dollar will help US importers in lowering their prices with currencies of low-cost countries also showing some more weakness.

The Mexican peso has plunged by 16.3% in 2016 in dollar terms whereas the Chinese yuan has dropped 6.5%, losing 12% in the last two years.

Beijing will be officially accused of currency manipulation by US trade officials and sanctions may be expected triggering similar decisions in China.

More important, the lack of stability will further depress currency values in emerging countries, with Turkey again affected by political uncertainties.

The lira has already slid by 34% in the last two years and could further drop in 2017.

More than ever, the volatility of currency values will be the main concern of US and EU importers looking for lower prices at retail.


















































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