The Republican candidate seeks to implement aggressive tariffs on imports and cut taxes domestically, which implies that the world’s main currency could strengthen.
He dollar indexwhich measures the North American currency against a basket of currencies, appreciates strongly and rises 1.8% on the first day after the victory of donald trump in the battle for the presidency of the United States. On the other hand, the main Latin American currencies are devalued and the price of commodities becomes cheaper. If this trend consolidates, A stronger dollar will change international trade and will have an impact on Argentine finances.
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This conclusion can be reached quickly if we take into account some parameters that the now president-elect outlined during his campaign. Aggressive tariffs on imports and deep tax cuts domestically They will cause the world’s main currency to strengthen. “The higher expected returns, derived from Greater inflationary pressures and growing indebtedness would attract flows that would appreciate the currency.“, they analyzed this day from Personal Investment Portfolio (PPI).


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Dóalr: how Trump’s victory will impact global markets.
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This dynamic could be detrimental for emerging countries. And from the stock broker they warn that import tariffs directly affect countries that depend on exporting to USAas China, Mexico and India. “This would affect the electronics, machinery and textile industries in China, the automobile, machinery and electrical equipment industry in Mexico, and the pharmaceutical products or IT services exported by India,” the report adds.
The relationship between the appreciation of the dollar and the price of commodities is inversemeaning that when the US currency strengthens, product prices typically decrease. This will have a significant impact in countries like Brazil and Argentinawhose economies depend largely on the export of raw materials.
Strong dollar: how it impacts Argentina in the short term
For Gustavo Quintanachange operator PRthe bullish outlook for the greenback in the world will not impact the local currency market too much, since The maintenance of restrictions and stocks act as an isolating factor against these phenomena.. “Local prices are disconnected from the price of the dollar in international markets,” he said in a conversation with this medium.
“Now then, Yes, it can have an impact on commodity prices, with price variations that adapt to a new reality of a stronger dollar and that can harm the producing and exporting countries of these products,” he explained, but anticipated that it is still premature to make very accurate projections.
“The new government in the US takes office in January and we will see, from there, what news we have. But I think, without a doubt, a strong dollar will impact global trade.”Quintana closed.
In turn, the economist Gustavo Berin dialogue with Scope said that a stronger dollar It could represent a challenge for our country, above all, if it occurs in a sustained manner. “This is because it could condition commodities and also generate weakness in other currencies, including emerging ones”said. And he added: “Despite the first reaction, it will be necessary to see if the strongest global dollar scenario in time occurs. if the US does not correct its fiscal imbalance and debt“.
Source: Ambito

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