There is a growing internal financial crisis in the US with the possibility that there will be de-valuation of the dollar. Which amongst the following countries is/are most affected?
India
China
European Union
Japan
Answer is Wrong!
Answer is Right!
This question was previously asked in
UPSC CAPF – 2011
– China is a major trading partner of the US. A weaker dollar makes Chinese exports to the US more expensive for American buyers and US exports to China cheaper for Chinese buyers, potentially negatively impacting China’s export-oriented economy.
– Other countries like Japan and the EU are also major holders of dollar assets and significant trading partners, but China’s scale of dollar holdings and trade dependency on the US market often makes it the most vulnerable to significant US dollar fluctuations.