Abuse of the US dollar hegemony output inflation impacts the global economy

This year, the Federal Reserve Committee raised interest rates four times in four consecutive times, of which 75 basis points raised interest rates in June and July, respectively, the largest interest rate hikes since the early 1980s. As a result, the US dollar has continued to strengthen, and international funds return to the United States, causing many countries and regions to inflation, depreciation of currency, and even the risk of debt defaults.

Analysts pointed out that in order to stimulate the country's economy, the United States once adhered to the "water release" of financial and monetary policies, and now it has tightened the monetary policy. Behind it is the misjudgment of the economic situation and the decision -making response. The US finance and monetary policy rely on the US dollar hegemony to repeatedly disturb the global financial market, which not only harms the reputation of the United States, but also passes the risks to other countries and regions, becoming a major source of chaos in the world economy.

Global inflation "American output"

At present, the world economy has not been fully recovered from the new crown epidemic, and many economies have slowed down, and they have to suffer additional pressure brought by US finance and monetary policy.

At the beginning of last year, some people in the economics community warned that the large -scale stimulus policy in the United States could trigger "inflation pressure that a generation had never seen before." The U.S. government insisted that inflation is a "temporary phenomenon" and continued to advance the trillions of dollars stimulus plans.

Recent

The inflation rate in the euro area has reached a new high in the near future. According to data from the EU Statistical Bureau, the inflation rate in the euro area in August was 9.1%at an annual rate. The inflation rate of nine countries in the 19 member states of the euro zone is calculated on a double digit at an annual rate. In order to curb inflation, the European Central Bank launched a rate hike for the first time in more than 10 years in July.

Germany's "South Germany will" commented that the European Central Bank has been brought into the rhythm of interest rate hikes by the Federal Reserve, and has to increase interest rates to inflation, and the risk of economic recession in the euro zone has increased sharply.

The latest survey of Japanese civil agencies shows that domestic price increases will exceed 18,000. Japanese media and experts generally believe that domestic inflation facing input -type inflation is that the prices of imported goods at US dollars have risen sharply.

In addition to developed economies, inflation levels in some developing countries are even innovating and constantly impacting the economy. According to statistics, Egypt's annual inflation rate in July reached 13.6%, the highest level since May 2019. In the 12 months as of June this year, Brazil's broad consumer price index rose 11.89%.

Currency depreciation "USD manufacturing"

The Fed has repeatedly accelerated the pace of currency policy, and the US dollar continued to strengthen, which led to the softer currency of other economies, exacerbating its own inflation, and the prospect of economic growth even more dim.

As the European Central Bank's currency policy tightened far behind the Federal Reserve at the same time, the difference between the United States and Europe has continued to increase. Recently, the euro has continued to weaken, and once fell below the US dollar at a parity. Analysts believe that due to the lingering of energy shortage and high inflation, the market is concerned about the economic prospects of the euro zone, and the "dollar is more expensive to the euro" may become the norm.

Dumbered by weak domestic demand and weak economic recovery, the Bank of Japan was forced to adhere to the super loose monetary policy, and the difference in the monetary policy of the Bank of Japan and the United States caused the yen exchange rate to plummet. On the 2nd of this month, the exchange rate of the yen to the US dollar fell into the 140 yen range from 115 yen at the beginning of the year, refreshing the 24 -year low. The depreciation of the yen years exceeded 20%.

The sharp depreciation of the yen further enlarged the impact of the rise in international commodities on the Japanese economy. According to data released by the Bank of Japan, the prices of Japanese companies have risen year -on -year due to the continued soaring price of imported goods. The price index of corporate prices in July reached the highest level of history.

In the Middle East, the Turkish li La's exchange rate fell to 18.09 to 1 in late August, compared with more than half compared to a year ago. In the past year, the prices of gasoline and diesel in the country have risen more than doubled.

American columnist Flida Getis bluntly stated that the US monetary policy is creating new problems for other economies that have been continuously hit.

Debt risk "American -funded giving birth"

Frequent interest rate hikes and strong currencies have continued to rise in international capital, and hot money returns to the United States. Emerging markets and developing economies may face the dual dilemma of "more difficult financing and more expensive debt repayment", and the risk of debt crisis has increased.

Jahiti Gaoxi, a professor of economics at the University of Massachusetts, said in an interview with Xinhua News Agency that the Fed's tightening of monetary policy will lead to the withdrawal of capital from emerging markets and developing economies to the United States. Bring a debt crisis and exchange rate crisis to many parts of the world. At present, several countries have already appeared in debt defaults or on the edge of breach of contract.

Some experts pointed out that the United States 'first placement of water and then raising interest rates will greatly increase the pressure on Latin American countries' debt repayment. The difficulty of gaining new credit will also increase, which may cause new debt traps. Taking Argentina as an example, the Federal Reserve ’s interest rate hike increases the risk of Argentina's exchange rate fluctuations and capital escape, affecting the market's confidence in Argentina's economy, and further increased debt repayment in the country.

Analysts pointed out that emerging markets and developments must be highly alert to the impact of US finance and monetary policy overflow. They should strengthen coordination and cooperation to jointly maintain international financial stability and promote the healthy and sustainable development of the world economy.

- END -