The United States recorded a Current Account deficit of 3.10 percent of the country's Gross Domestic Product in 2020. so
Posted: Thu May 05, 2022 6:32 am
- The United States Recorded A Current Account Deficit Of 3 10 Percent Of The Country S Gross Domestic Product In 2020 So 1 (157.21 KiB) Viewed 57 times
between 1,05 and 1,15 (until COVID19) and the current account
deficit (always negative was at its best between -2,2 and -2,4% of
GDP for the most part. With the declared pandemic by the WHO we can
see a trend reversal f or the dollar value which matches a deficit
increase ( -3,1%). A prominent explanation for the depreciation is
the increase in the US current account deficit.
But now we throw into the game the FED’s contractionary monetary
policy aimed at keeping inflation in check. See below FX rate since
FED increases rates.
- The United States Recorded A Current Account Deficit Of 3 10 Percent Of The Country S Gross Domestic Product In 2020 So 2 (63.26 KiB) Viewed 57 times
deficit is the dominant factor (in explaining the depreciation of
the dollar) ... The US deficit is running at 3,1% of GDP. This
implies further dollar depreciation from here.”
We know, however, that the CA deficit is the difference between
saving and investment.
1. Will we see a depreciation, or an appreciation of the dollar
given the current policy from the FED?
2. Will that help in changing saving and investment and thus
lead to the closing of the current account deficit?
3. Is a depreciation of the dollar vis-à-vis the euro the only
mechanism through which the current account deficit
can be reduced?
4.Can the US economy continue enjoying a CA deficit of 3,1% or
worse without further depreciation of the dollar?
The United States recorded a Current Account deficit of 3.10 percent of the country's Gross Domestic Product in 2020. source: U.S. Bureau of Economic Analysis -1 -2 1.7 -2.2 -2.2 -2.4 -2.3 -2.4 -2.6 -2.7 -3 -4 -5 -6 -7 2015 2020 TRADINGECONOMICS.COM | U.S. BUREAU OF ECONOMIC ANALYSIS Zoom: 1m 6m 1y 10y all 2020 Select: Period: 1.45 1.40 1.35 1.30 1.25 1.20 1.15 1.10 1.05 1.00 -2.4 2010 -3.2 -3.9 -4.2 2000 EUR vs. USD 29/04/2010 2011 -4.3 -4.7 -5.3 -5.9 -6 2005 E 30/10/2020 2012 Yout expoz 2013 -5.1 -4.7 E 2014 -3.2 -3.1 2010 2015 -2.7 bersiche. 2016 -2.4 2017 2018 2019 -3.1
Select: Period: 1.11 1.10 1.09 1.08 1.07 1.06 1.05 1.04 EUR vs. USD 14/03/2022 Mar 16 Mar 20 Mar 24 30/04/2022 Mar 28 Apr m Apr 05 Zoom: Apr 09 1m Apr 13 6m Apr 17 1y Apr 21 10y Apr 25 all Apri go