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Economy

“‘Bad situation’: Soaring US dollar spreads pain worldwide”

“The cost of living in Cairo has soared so much that security guard Mustafa Gamal had to send his wife and year-old daughter to live with his parents in a village 70 miles south of the Egyptian capital to save money…

Around the world, people are sharing Gamal’s pain and frustration. An auto parts dealer in Nairobi, a seller of baby clothes in Istanbul and a wine importer in Manchester, England, have the same complaint: A surging U.S. dollar makes their local currencies weaker, contributing to skyrocketing prices for everyday goods and services. This is compounding financial distress at a time when families are already facing food and energy crunches tied to Russia’s invasion of Ukraine.

“A strong dollar makes a bad situation worse in the rest of the world,” says Eswar Prasad, a professor of trade policy at Cornell University. Many economists worry that the sharp rise of the dollar is increasing the likelihood of a global recession sometime next year.

The dollar is up 18% this year and last month hit a 20-year high, according to the benchmark ICE U.S. Dollar Index, which measures the dollar against a basket of key currencies…”

https://apnews.com/article/inflation-middle-east-africa-business-global-trade-bee68344b1812dd48ca9c0735395b868

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