A Stronger Dollar Could Hurt US Manufacturing
Donald Trump’s win and the Fed’s move to jack up rates pushed the dollar to a 14-year high, but those gains could hurt US manufacturing by making exports more expensive.
A strengthening dollar helps the US economy by making imports cheaper, which often boosts retail sales, but a stronger currency also makes it harder for US manufacturing companies to sell goods abroad, the Wall Street Journal reports. As American goods become more expensive due to the rising dollar, many US manufacturing firms are already starting to cut revenue forecasts.
Boeing, the nation’s largest exporter, reported less sales opportunities and increased competition will push it to layoff more people next year, even after getting rid of 8% of its staff this year. [WSJ]