Khmer Riel vs. USD
Khmer Riel vs. USD
The USA has been raising interest rates, and all kinds of currencies are crashing relative to the almighty dollar. Euros, British Pounds, kroner, yen, Aussi dollars, dong, bath.
But not the Cambodian Riel. What's going on here? Why the surprising strength? As far as I can see, its not pegged to the USD.
But not the Cambodian Riel. What's going on here? Why the surprising strength? As far as I can see, its not pegged to the USD.
Both the Riel and VND are pegged to the dollar.
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It’s always been a slightly weird one because it’s difficult to buy or sell Riel outside the country, and most usdkhr exchanges happen in regular shops, so it’s not subjected to the usual type of forex activity. It’s held at 4000-4100 because it collectively suits the people performing 99.9% of transactions with it for it to stay at that figure.
(I am not an economist)
(I am not an economist)
Outside of local Asian markets there is no exchange except with the USD to hold the peg. I think the idea is it can help weather the international economic storms (while destroying itself from within by printing Riel to maintain the peg and causing local inflation.) The cost of goods becomes higher if the dollar goes higher, so exports to anywhere but the US or other pegged nations are affected.nerdlinger wrote: ↑Sun Jul 10, 2022 12:41 pmIt’s always been a slightly weird one because it’s difficult to buy or sell Riel outside the country, and most usdkhr exchanges happen in regular shops, so it’s not subjected to the usual type of forex activity. It’s held at 4000-4100 because it collectively suits the people performing 99.9% of transactions with it for it to stay at that figure.
(I am not an economist)
This us not financial advice.
I am an ape.
^ Nearly everything is imported, including the materials and components for the exported goods.
With the dollar at 1.7 on the DXY, why would that be a problem? Wouldn't it be cheaper? As I understand it most commodities in the world are bought and sold in the US dollar. There is a huge demand for the euro dollar. Much bigger than in the US.
Dollar denominated debt is is around 3% interest. Whereas, debt using emerging markets currency, like the Argentinian Peso, needs to be repayed at 10%. The drawback is you need dollars to service it. Print more Pesos: buy more Dollars. Push the dollar even higher untill the whole thing comes to a grinding halt.
Is that a fact? I don't know too much about the other currencies you mentioned but the British pound was predicted to fall at least 5% post-Brexit.
Yes
The British Pound has fallen some 14% relative to the USD (1.3964 to 1.20349) over the last year, with the majority of the fall having taken place from late February 2022.Dylan Quint wrote: ↑Sun Jul 10, 2022 4:49 pmIs that a fact? I don't know too much about the other currencies you mentioned but the British pound was predicted to fall at least 5% post-Brexit.
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Has it got something to do with that the majority of the population are involved in agriculture and producing food?
Quod scripsi, scripsi
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Not really. Although the majority of the population do live in rural areas the agricultural sector doesn't bring in as much as manufacturing or some other sectors.Frycek Edzio wrote: ↑Sun Jul 10, 2022 7:01 pmHas it got something to do with that the majority of the population are involved in agriculture and producing food?
Romantic Cambodia is dead and gone. It's with McKinley in the grave.
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You do realise that is old data?nerdlinger wrote: ↑Mon Jul 11, 2022 12:34 amAnother possible reason why the Riel has managed to hold its own:
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