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Is the Euro stronger than the U.S. dollar?
The tussle between currencies is a well-known affair. Due to varying reasons, say economic boost, political shift, or any unforeseen circumstances, the currency of the nation witnesses a dip or arise. Investing capital in the Forex has always been in trend. With the accompanying risk, there’s an enormous opportunity for growth and profit.
Amidst all the discussions and speculation, there has been a constant query or a point of curiosity that, despite the U.S. being a superpower has its currency undervalued than that of the European Union, though both are few of the strongest currencies across the globe. We are here to find the origin, journey, and the mystery behind this fact. So let’s get down to the basics.
Art of Trading Currencies
An individual can trade or invest in any currency via the avenue of foreign exchange. The process involves a lot of risks as the market has ephemeral stability. Any slight turmoil can change the flow of capital and add chaos to the Forex domain. However, the other way to see this can be tides can turn into the investor’s favor, too, as the depreciating value of a currency can profit someone who had bid against it. The bid for the currencies is relative i.e., you always bet for a currency’s value (say X) with respect to the value of other currency’s value (say Y). To yield a high return, one must be active and an ardent investor with hawk’s eye vision.
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The Great Currency Debate
Euro:
Used by 27 nations Euro is one of the strongest currency in the world that come under the canopy of the European Union (E.U.), these countries follow a pre-defined set of rules and regulations. They have unanimously agreed to have Euro as their national currency. Being a major reserve currency, the Euro can singlehandedly control the tides of the market and is of prime significance. Moreover, it is not pegged to the U.S. Dollar, which is the main reason for market fluctuation in the varying economic circumstances.
Dollar:
Made up of 100 cents, the United States Dollar is the official monetary notation of the United States. Widely popular, the currency is the standard benchmark for almost all the market services and commodities. It is widely used for numerous transactions worldwide because of the American market’s trade monopoly. One of the interesting facts associated with the currency is its usage by other countries’ incoherence to their currency.
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