The Dollar vs Oil
The dollar is one of the most used currencies in the world, and no
doubt because there is so many of them.
Regardless of political policy and the United State’s federal reserve,
there has to be a reason why the dollar is so popular.So why is the dollar fall related so much in the past week to oil volatility?
popular because of its ties to oil. The price of oil anywhere in the
world is directly tied to the US Dollar. The rise and fall of the
dollar allow the hundreds of other nations to buy oil more cheaply or
more expensively.
The need for energy is at its highest over the last few years, and now
as supplies are dropping due to emerging middle classes in places such
as India and China, supplies are also diminishing. The crave for
energy is also multiplied by the falling dollar. As the dollar falls,
countries or areas such as the EU can more readily purchase needed oil
at a 40% discount than just a few years ago.
While the dollar falls, it also pushes oil to record highs. See, the
market adjusts accordingly to a falling dollar by bidding up the price
of oil. Cheaper oil means higher demand which means more expensive
energy for nations like the United States.
Good luck daytrading dollar vs oil
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