Who’s in trouble, the US dollar or emerging economies?


TOKYO — The U.S. dollar has resumed appreciating as currency market participants, prompted by a steep rebound in the U.S. economy, actively buy the greenback, a trend that could worsen the predicament of emerging economies struggling with the resurgent pandemic.

The theoretical value of the dollar noticeably fell after the U.S. government began to write checks to help Americans through the pandemic, causing its debt to swell. But the market changed directions earlier this year.

The U.S. economy, as measured by gross domestic product, expanded at an annualized rate of 6.5% in the April-June period from the preceding quarter. The fast pace came thanks to sharp increases in personal consumption and private-sector capital spending, which bounced back to pre-pandemic levels. Although the risk of another COVID-19 wave remains, economic barometers are generally solid. It now takes about 109 yen to buy a dollar, up from the 103-yen level at the start of this…

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