The recent decline in the dollar’s value has prompt intervention from several central banks in Asia which are worried a weaker dollar would further reduce their export capacity.
The central banks of South Korea, Thailand, Taiwan, Singapore and India are believed to have sold their home currency and in return bought the U.S dollar. This as response to the recent decline in the U.S currency.
A major part of Asia’s economy is relying on exports, and so, with every serious drop in the dollar’s value ( as was the case the last week) comes a serious blow to these Asian economies. Just think about a scenario in which Thailand losses its reputation as a cheep resort for tourists, since the later can now only get 70% of what they used to get for their dollar . Not a favorable scenario for the Thai’s, especially with an economy which is geared strongly toward truism.
Z.Georgi
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