The United States has raised interest rates again! The US dollar exchange rate has exceeded 7.1

Two days ago, the Federal Reserve announced another 75 basis point interest rate hike after the end of this month's monetary adjustment meeting, raising the target range of the federal funds rate to 3% to 3.25% , the highest level since 2008!

The Federal Reserve has raised interest rates by 75 basis points for three consecutive months, which is a very strong regulatory measure. In addition, the Federal Reserve also stated after the meeting that the interest rate hike process will not stop until the inflation level is under control. The Federal Reserve's initial goal is to reduce inflation to below 2%.

The US inflation rate in August was as high as 8.3%, which is still quite far from the Federal Reserve's target of 2%.

In addition, the inflation rate in the United States was 8.5% last month. The Fed has been raising interest rates for such a long time, but the inflation rate has only dropped so much in one month. It can be inferred that the current round of interest rate hikes in the United States will not be until the middle of next year. The Fed predicts that if the rate hike continues at this rate, the federal funds rate may be raised to 4.6% next year.

After the interest rate hike was announced these two days, the RMB exchange rate against the US dollar soared to 7.1, an astonishing increase.

The current round of interest rate hikes in the United States is closely related to the US dollar exchange rate. As you can see in the above figure, the two most critical time points of the surge are April, when the Federal Reserve officially announced that it would start the interest rate hike process. The other is July, when the United States first began to raise interest rates by 75 basis points. It can be said that the Federal Reserve's three consecutive months of 75 basis point interest rate hikes did not suppress US inflation, but did increase the US dollar exchange rate.

Judging from the purpose and results of the interest rate hike, the United States will not stop the interest rate hike process in the short term. In this case, at least our sellers don’t have to worry during this peak season. At the end of the year, Amazon is also trying new changes on Black Friday to further expand the intensity of free activities. These two favorable factors together make this year’s peak season worth looking forward to.

Although the exchange rate is a big positive, we have discussed the exchange rate issue many times in our sales circle. Many people believe that this part of the positive effect is just to offset the various price increases of Amazon. If sellers want to make full use of this opportunity, they still have to take advantage of inflation to increase product prices.