Strong US Dollar Implications For Business Owners [Video]

With the economy’s instability in the past few years, Americans hope for any sort of relief. Luckily, some hope has come in the form of the US dollar index. Coming in at its peak since November, last week’s report has the American dollar’s strength far above most other nations.

Several factors have led to this point. American manufacturing has expanded for the first time since September of 2022, and the job market has remained strong through March. Add on that consumers have continued to boost retail sales for the past several months, and the economy has proven to be resilient.

What this means for Americans is that “the purchasing power of the dollar is higher and consumption will remain strong”. Business owners can expect their customers to continue spending their money at a higher trend. However, this also means that the Federal Reserve may consider keeping rates higher for longer to stave off inflation.

Despite this potential setback, the US market remains ahead of the rest of the world, especially since the nation is largely “energy independent”. This has led to less of an effect from the conflict in the Middle East, which has been driving up energy prices in Europe and Japan.

With all this in mind, business owners should remain vigilant of both economic news and their business’s numbers at all times. Though the US dollar is currently stronger than normal, overdependence on the current state of the economy could lead to pitfalls if you are not prepared for any turn it may take. Be vigilant, and know your numbers.

If you need guidance for your business at this time, the XQ CPA team is here for you. Our expert advisors are happy to assist you with your business’s finances and tax planning. Give us a call to schedule a free consultation today, or use our convenient online booking at the link below.

Phone: 832-295-3353
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Sources:
https://www.cnn.com/2024/04/21/markets/stocks-week-ahead-dollar-rally-global-economy/index.html
https://www.cnn.com/2024/04/15/economy/us-retail-sales-march/index.html
https://www.cnn.com/2024/04/05/economy/us-jobs-report-march-final/index.html
https://www.cnn.com/2024/04/07/business/stocks-week-ahead-manufacturing-industry-expanding-rate-cuts/index.html

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