The high inflation of many countries highlights the harm of the US dollar hegemony

In recent months, from Argentina to Tunisia, from Germany to Turkey, the level of inflation in many countries is high, and prices have risen. This is closely related to the negative spilling effect of the radical adjustment of the US monetary policy, and once again highlight the US dollar hegemony to disrupt the harm of the global economy.

Since March of this year, the Fed has continuously radical interest rate hikes in response to the high inflation in the United States, and has promoted a significant appreciation of the US dollar. Because the US dollar occupies a dominant position in the international currency system, many commodities such as food, oil, and natural gas are mainly denominated and settled in the US dollar in international trade. The appreciation of the US dollar means that the import costs of multiple countries have risen and the pressure of input inflation has intensified. Bloomberg reported that the United States exported inflation to the world through interest rate hikes.

On July 27, Fed Chairman Powell attended a press conference in Washington. The Fed announced the 75 basis points of interest rate hikes on the same day. Xinhua News Agency reporter Liu Jie

After the Ukrainian crisis was upgraded in February this year, the economy of many countries has been significantly impacted, and the prospects of global economic growth are not optimistic. Western sanctions on Russia also led to the surge in commodity prices such as natural gas and oil. In this context, the Fed ’s interest rate hikes output inflation to the world, causing people's lives to suffer greater pressure. In Germany, due to the continuous rise in prices, more than two -fifths of Germans said they could not maintain their existing living standards. In Lebanese, the surge in prices has made many people have to give up the tradition of buying candy cakes to entertain relatives and friends. In Turkey, some taxi drivers reported that oil prices rose sharply and eroded the "lotus bags", and the purchasing power was significantly shrinking. According to the Wall Street Journal, at the same time as high inflation suffered from high inflation, the United States benefited from the appreciation of the US dollar and relieved the inflation pressure.

Due to the US dollar leading the international currency system, the Fed's radical interest rate hike has also exacerbated risks such as capital outflows, national currency depreciation, and debt defaults. Some economies with fragile economic fundamentals and insufficient foreign exchange reserves have been impacted. The Australian East Asia Forum website recently reported that the current situation and the situation in the early 1980s are worrying. At that time, the Fed raised interest rates to suppress inflation. In the Latin America region, the debt crisis was triggered. The economic growth of many countries declined straight, and the unemployment rate and poverty rate increased. Some American scholars have recently said that there are currently several countries that have debt default due to the Federal Reserve ’s interest rate hike or on the edge of breach of contract.

It is worth mentioning that the cause of the Federal Reserve's interest rate hike is that the United States inflation has risen, but the US inflation is higher, which is precisely caused by the US's own economic decision. In recent years, in order to deal with the impact of the new crown epidemic, the United States has adopted a large -scale stimulus policy. The fiscal deficit has soared, and the currency has severely exchanged. Last year, a person in the US economics community warned that the super loose fiscal and monetary policy adopted by the United States may cause "inflation pressure that a generation has never seen."

This is the Federal Reserve building taken in Washington, USA on June 1. Xinhua News Agency reporter Liu Jie

The US dollar hegemony brings "arrogant privileges" to the United States. When it is necessary to boost the economy, the United States injects liquidity to the market through very means such as quantitative easing, stimulating the economic growth of the United States; when inflation is high, the United States will suppress it through interest rate hikes and attract international capital to return to the United States. The United States abuses the addiction of the US dollar hegemony, and has repeatedly adopted the radical adjustment of monetary policy, provoked market shocks, and harvested global wealth. With the influence of the US dollar world currency, the United States has "weapons" in the US dollar to expose its irresponsible and extremely selfish nature, and also allows the world to further see the dangers of the US dollar hegemony.

In recent years, the voices of establishing a more fair and reasonable international monetary system have become stronger globally. Many countries have been exploring the US dollar hegemony, such as reducing holdings of US debt, promoting foreign exchange reserves assets, and exploring international trade Use bilateral and multilateral currency protocol settlement transactions, etc. As the Turkish economist Marchi Elmez said: "The process of getting rid of the US dollar hegemony has begun, and the momentum will become more and more obvious and stronger and stronger." (Reporter Han Bing)

(Source: Xinhua News Agency client)

【Edit: Fu Sakura】

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