Bitcoin Forum

I don’t know about you’ll but it’s been many year’s since I last heard, that Europe’s economy was moving faster than US economy, but thanks to Covid-19 times have changed and Europe’s economy is speeding ahead. Further if US doesn’t stop the spread of Covid, and reopen soon then they may find their economy lagging behind Europe for a long period of time. Lastly what kind of impact will this have for the world?, as we have always looked up to US and it’s $, so do you’ll believe that Europe’s € can make a comeback and replace the $ in the long run?.


Source:

https://www.bloombergquint.com/global-economics/europe-s-economy-set-to-outpace-u-s-in-upending-of-past-roles

I have to say, when initially considering the impact of COVID-19 on the global economy and forex markets, I didn't expect such a glaring disparity between the US and the rest of the world regarding handling of the outbreak. It's pretty amazing, like night and day.

Monumentally bad candle close last week for the DXY. Clear range expansion and close below the BB:

https://i.imgur.com/NCUQtnZ.png

Assuming there is follow through by dollar bears next week, it looks like a mid-term downtrend on the horizon. EUR is making similar moves to the upside against the dollar.

Big picture, I don't take any of this "replacing the dollar" talk seriously. Not yet anyway.

No countries economy can be defined perfectly. Everything is based on the received data, and not based on the perfect collective data. Upon this US economy and Europe economy can't be calculated. The economy of US has highly affected due to the covid-19 attack, yet they're stronger than Europe. Maybe if the country has been shut for a long there might be big difference in the lagging.

I don't think euro can replace dollar because of this pandemic. I believed that US still find the solution behind to handle their economic situation. Also if ever the economy of US will not recovering ,they can't fight against china and i read something that US are now preparing their armed forces to battle against china.

This chart clearly looks like that of last week. It showed a dollar weakness from the beginning of early Monday, trading day till later on Friday when dollar started to have some fight back recovery. The eur or pound's won't replace the popularity of dollar, it just a momentary loss, I expect the late Friday recovery to continue by this trading week.

Temporary spikes in the stock market can't be interpreted as a sign of economic recovery. Apart from the UK and Germany, the economies within the European continent are not looking really good right now. The other EU nations such as Italy and Spain are surviving, just because of generous help from the German-headed EU. At least when compared to these sinking economies, the United States is in a much better condition. The only concern should be the ballooning federal debt, which seems to have gone crazy.

As I heard, these two countries are helping to each other. Just like they had a commitment to fundamental democratic principles, they should also be shared about the improvement of their GDP. I don't see that Europe will replace or even overtaking the US economy despite their difficulties of facing the problem due to the pandemic.

In terms of landmass, these two countries were almost the same size but the more population in the US which I think, economy recover isn't impossible for them even though they are facing struggles and problems right now.

1. The breakthrough was actually the successful completion of COVID-19 vaccine from Oxford university, the scientists alone became millionaires , now due to the production of vaccine , they will be able to earn a lot through other countries.

- There have also been reports of China stealing data of Europe and US regarding the vaccination and treatment of the virus .

2. US failed in handling the Corona virus , I do think the economy they are showing right now is like a bubble which will burst very soon , the volume is fake and local businesses are failing , they cannot even control and listen to the demand of the people . Upcoming elections probably will see a upturn .


https://www.bbc.com/news/uk-53469839 (https://www.bbc.com/news/uk-53469839)
-News when the vaccination triggered response
(P.S. even though the vaccination have side effects and can be dangerous it's still a very big breakthrough and we can soon see it being demanded by a lot of countries soon )

I'd rather believe that Yuan is more capable of replacing the dollar currency than Euro, the data is just a short-term data every conclusion made based on this is more likely to fail. We are seeing the Europe is ahead in terms of the recovery but it does not mean anything to their economy in general. The dollar is weakening, yuan is getting stronger this is a better comparison than Euro and Dollar, competition are highly expected among these currencies. In 1990s there was an analysis that suggests the Euro to replace the dollar by the year 2020 stating that it could be the major reserved currency but only if European countries will use Euro as their main currency which is unlikely to happen.

What?! where'd you read this information? This information is highly classified just for the internal intelligence of the USA how could you be able to know this? LOL

As always every country's armed forces is ready not just the USA.

China wants to know your location lmao

If china wants the yuan to become stronger than the dollar, all they have to do is sell their $1.4 trillion dollar bonds back to the US treasury, and buy up bonds for their own currency for it. But they won't do that, because doing this will make their exports cheaper. And they don't want to decrease the value of their exports because they are the largest exporters in the world, and they would lose a ton of money from doing that.

Well, it is really possible that other countries such as China and other european countries may speed ahead of US when it comes to economy as of this time but if we talk about influence they are still far behind to US. We must consider not only the economy but also the influence of the country when it comes to technology, armed forces, education as well as politics. which has been globally accepted and embraced by most of the countries. Furthermore, --it may seems that US economy nowadays is moving slowly because of the pandemic but the mere fact that they are shutting down their global economy it can also be their one way of healing the wounds that the pandemic has caused them and when they start to open again rest assure it will be big leap that will secure their leadership and being the top country again worldwide.

Japan was described as a hedge in many places before this crisis when a depression hits the rest of the world. This may now be a thing that rests on Europe as well as Japan. I think the US and China have lost a lot of time and its interesting if they have finally gone into lockdown? Sweden didn't and they didn't do too badly - the UK arguably had a meaningless lockdown because most of the damage was a already done.

I think the euro may see some adoption but it might take a while for other countries to switch to that rather than the dollar, Scandinavia and the UK never joined the eurozone but Europe has a lot of financial favlurabulity when it comes to transactions and regulations - such as the UK having almost instant banking transactions.

https://data.imf.org/?sk=E6A5F467-C14B-4AA8-9F6D-5A09EC4E62A4

58% vs 1.9% is a very big comparison, Yuan does not have the capability to shift the Dollar. I think that it is almost impossible for Yuan to become a second option as an international currency with consideration

- The dollar is still considered a barometer of balancing a country's economy
- The foreign exchange reserves of many countries are in the form of dollars, hoping that replacing dollars means that a country agrees to be poor.
- Which country is willing to be paid with Yuan in international trade?
- The reason the dollar is replaced is certainly something more terrible than the great depression, and even then the US will not remain silent, who is ready to compete with the US and its allies?


The presence and provocation of the US military in the South China Sea can be evidence that there is an escalation of tension between the US and China. The US, which carries the slogan of America First, has an interest or feels threatened by China's military intensity, and vice versa.

Europe's economy isn't "moving faster" than the US economy.The EU GDP is simply going down,but a little bit slower than the US GDP.All the big economies are in recession,so there's such thing as "moving faster" and there's no growth.
We don't know what will happen in the next few months.Maybe the USA will start to recover faster from the recession than the EU.
The Federal reserve was move active than the European central bank during the last few years,so the US economy was pumped with more freshly printed money.I guess the corona crisis hits harder in the country,tht has a more artificially stimulated economy.That's just a hypothesis.

I'm curious what the Q2 GDP numbers will say. That will give us an idea of the possibilities for recovery in the pandemic context, especially if the lockdowns become an intermittent thing. There will most definitely be a contraction for the quarter but I have no idea if it's going to be -10% or -50%.

China got back in the black (barely) although I'm always skeptical of the official government numbers. https://asia.nikkei.com/Economy/China-s-Q2-GDP-growth-beats-forecasts-and-recovers-to-3.2

Euro will replace dollar eventually with or without pandemic, there is no world where USA could continue down this spiral of "make the rich richer, make the poor poorer" forever, Europe on the other both have companies that makes tens of billions of dollars in revenue from other countries and also still manage to help the least fortunate people of their nations at the same time, they are a proof that you can both have universal healthcare and also not high taxes, they are proof that you can be a billionaire, and still help poor people.

Basically Europe is doing everything right that USA doing wrong. Maybe this pandemic showed that a little bit more carefully in the short term but at the same time it was inevitable, it will reach to that point maybe in 1 year, maybe in 10 maybe in 50 but it will get there for sure.

We all know that based on most of the reports, US is really having a hard time handling the Covid-19 virus in their country as the people is really stubborn to follow the protocols. That's the reason why they can't open businesses temporarily to recover their economy because it might increase the number of cases in their country and the Covid-19 get worse. Still, US have a well-developed economy than Europe due to its popular businesses although they are having a hard time surviving their economy.

This probably wont happen in the near future or atleast in 10 years span. US has been on the top of this world for quite some time and they are definitely not going down the drain especially to Europe


Yes they are but the whole word indicator would still be the US Dollar for the majority of the countries and it wont be Euro . That actually means something and we are still on the early stage of the pandemic. Things could turn south with this whole pandemic's thing and when that happens , only few countries will prevail and one of them are US


It is most likely because the words " FREEDOM " is kinda jumbled up on their heads though  :P. Sarcasm aside, it could also due to the US is probably having their election soon so alot of ruckus on the country as well as one sided media reports

LOL.. The CNY is one of the most manipulated currencies in the world. The Chinese government devalues the currency every now and then, to help the exporters within their country. Even their best friends, such as Russia and Iran are not comfortable in using CNY for trade between them and China. The Chinese are trying hard to make the CNY the currency of global trade. But that is not going to happen anytime soon.

Europe's economy may outpace that of U.S. due to the ill effects of COVID-19 but let us bear in mind that this could only be temporary not to mention that the pandemic is not yet over as every country in Europe that has suffered the most could again experience next waves of this disaster, hopefully not!

Also, I think its irrelevant to compare economic data of Europe or its countries within  to that of the U.S. economy since that Europe is a continent whilst the U.S. is not. Imho.

Absolutely that Europe is now getting recovery faster compared to what US is experiencing.
we can also check in Covid recovering countries that they make it faster to flattened the  curve.

no Wonder  they maybe have cure?or just because they tighten the laws because  my Cousin tells me bout that  because  he lives  in that area.

But the reality that both of them have experiencing serious economic crisis is a huge problem.

You don't need to compare the rate of GDP's fall due to recession of the two countries because I'm pretty sure that not all are safe in this pandemic. Economy that moves faster will only be achieve once we surpass this pandemic and when all of the happenings do go back to normal.


Hopefully, the 2nd wave doesn't come because it can worsen the economic crisis that we are experiencing. People in Europe and US are both stubborn that's why the virus in their country is easily transmitted from one person to another. You can't blame the government because its citizens are the one who makes this suffering worse.

Besides focusing on the economy, they also focuses on the people's behavior.


But we should make the population as the basis and not the land mass because for me it is much precise.

The population in US is 331,002,651, while in Europe 747,668,167, so it is more likely that the spread of the disease in the Europe is faster than US, however, the country with a huge number of Covid-19 is still US.

If Europe is recovering faster, then the reason may be that the pandemic situation has stabilized there. The pandemic in the United States started later and even now it has not peaked there. So any potential recovery may take a few more months. But once the situation is stabilized, I have no doubt that the American economy will be back on track.

Unless the vaccine for the virus is discovered then that would happen. By the time it happen, Europe's economy would probably going down drastically compared with US. As it stands right now, only a few country would be able to survive the pandemic without the help of other country and one of them would be US


That because compared with the rest of the countries, US is conducting larger number of tests therefore there are alot of cases found on the country. Some country has lower number of infected not because those countries are safer but probably due to limited number of tests being done then the infected isnt noticed and recorded onto the data

. . . and let us not forget that US spends more than 600 billion US $ on military alone!!

Dam, thats a huge stake on the military and which is not at all required in the current situation.

I was just thinking after reading your OP that US start thinking of spending this kind of money on the healthcare and proper research behind the COVID19. It would help them recover from the worsening situations faster and can get into business in no time.

It's funny how they are patrolling the US borders but not looking after the inside of nation which is getting weaker. At the last they will have empty nut shell!!

The management of the pandemic by the US government has been erratic to say the least and this is finally having an impact on the economy of the country as investors are losing hope the crisis can be controlled as the number of cases keep climbing up.In Europe despite how hard they were hit it seems they have found a better way to contain the pandemic and this is showing.

However there is a big difference between a good economic performance and the replacement of the dollar as the reserve currency of the world as I do not believe the European Union will last long enough to really challenge the dollar in that aspect.

I think there is nothing to be thankful about the covid-19 pandemic that brought up to Europe's fast pace on recovering compared to US because seriously we are facing into a serious manner and how fast the economy of a country recover must not serve as a race or comparison for there are certain reasons why US up until now is still struggling to control the inflation rate of covid-19 infected individuals in their country. It just so happen that US have a big bunch of population to be taken care of which leads them to have the most number of cases up until this current time.

Europe's fast recovery was indeed impressive at the first place but this must not serve to be a celebration that at last it have surpassed US economy just because of the existing crisis brought by this pandemic. Maybe it just so happen that Europe have reacted and put up a plan that can effectively control the scenario which makes them possible to recover fast compared to US. Different countries have different tactics and approaches towards resolving the problem but the important thing is that there is an improvement not just on the management of the cases but as well as for the recovery phase of the economy even if it is fast or slow

The fast recovery of Europe after the pandemic was really great for they have fastly react and do preventive measures to be able to come back after the quarantine they have implemented for at leat 2-3 months which make them be able to control the situation before it got worst. The government and the people have coordinated very well that is why their businesses establishments have opened up to make their economy working alive towards recovery. On the part of US, what making them struggling to control the infection rate is of course the big population they have which makes it difficult for the government to track down the infected individuals which lead to the continuous spread of virus making them rise to the top of the countries with most cases up until now. That is the reason why they are still struggling to open up their economy because it is still dangerous to do such because it might just lead to worse scenario that infection will go into a massive inflation rate.

Both countries do have different approach and way of facing the crisis which must not be compared because it is a serious matter that every countries are facing right now. What the important thing is that even US are still struggling right now and have been left behind by Europe when it comes to the economic recovery, US is making its best to control the situation first for the safety of its people before getting their economic recovery to the full extent. It is a process to be done and it doesn't matter how fast they would do it what matters most is how they could surpass this first. On the other hand, salute to Europe for making the most out of it on making fast recovery after also experiencing serious problem in relation to this pandemic.

Most european countries have helped their businesses to recover afte lock down in sense of financing part of employee's sallary of financial support to continue the work.
Also, EU has brought its own recovery plan and special dedicated funds that each member state will participate according to certain ratio, both in special loans and grants. All that helped to the optimism and for european economy to start to recover. I don't know that US has any of similar program or support. Of course, US and EU have different approach when it comes to economy and finances but EU government has do nothing to directly help the economy and employees and that will have deep consequences and this with pandemic is very special situation that will have very deep and long term consequences.

Timeline: europe and asia were hit hard by the virus, before any confirmed cases were announced in the united states.

Geographically they are located nearer to the epicenter of the pandemic. They were hit by it first. Which could mean their economies will naturally recover before america's does.

I see the US President tweeting now & it is strange that neither he nor his advisors seem aware of this.

https://twitter.com/realDonaldTrump/status/1289397528639791104

The response in some of the European countries that I have heard of are pretty superb, the fact that they follow the strict regulations during the lockdown helped a lot and I also can't forget that people followed the regulations which commendable for a mass to follow their authority. Regarding the OP saying that USD will be replaced by Euro, that will be difficult and complicated because there is was a system back then that makes Dollar a reserve currency for a country, we also should consider that US has a large gold reserves that backs their currency, I do not know much about monetary policy but I think USD being replaced by Euro is still far from conception.

Actually @OP is not wrong. EURO is also a major reserve currency FYI. It's a currency used even by some microstates such as Vatican and Monaco, as well as countries that are not even Europeans such as Zimbabwe, N. Cyprus. Even in the UK there are shops accepting EURO.

If it replaced ~20 currencies and if there are a dozen currencies pegged to EUR it can replace the US dollars too. There are also countries swithching from USD to EUR for international trading (ie Russia, Syria, Cuba). 20 years ago, Iraq decided the sales of oil have to be done now in EUR (it changed back to USD only because The US invaded Irak and forced the country to change its decision) But there are more and more countries looking to avoid the US dollar. Russia owns now more EUR than USD.

Just to show that finally it's not something so difficult or impossible as you may think. It will take time but more people or countries decide to prefer EUR and lose confidence in USD more chance you will see EUR replacing UDS.

https://www.americanexpress.com/us/foreign-exchange/articles/could-dollar-be-replaced-as-world-reserve-currency/

But there is another contender, the Yen, which is also categorized as a reserve currency by IMF since5 years

Europe’s € can come back stronger but saying to replace the $ (USD) seems still too early, buddy. I am sure that the US government will do something to recover the economy. Now, probably Europe's economy is growing better than the US, but will the US give up early for this pandemic? I think as said before that they will make certain strategies after this pandemic to bring the power back. Indeed, Covid-19 brings big impacts to the US economy since there are many victims of this pandemic. Not only the health industries that get a very hard situation but also giving impacts to the economy in that country.

Doctors were seeing COVID-19 cases in January in the US. They were just slow to begin testing anyone or locking down. At this point it's pretty obvious the economic toll of the epidemic is deeper and more prolonged there.


Japan has the worst debt-to-GDP ratio in the world. The Fed today is taking pages out of the Bank of Japan's book. Why would the yen become the dominant reserve currency?

I think this is a good take on the Euro question:


https://www.barrons.com/articles/why-the-euro-wont-replace-the-dollar-1536945404

There is no need to look at the data either, I can understand why the US economy cannot move quickly, as the country with the highest virus spread,
certainly has a negative effect on the economy. US must immediately open quarantine in various cities, so that business and industry can run again.
And make the US economy keep pace with the fast-moving European economy.

Yeah I have seen this news before about the Euro surging ahead of the US dollars. Coronavirus has hit the US economy badly where it hurts and they are still unable to resume a lot of Businesses due to the number of the people with the virus keeps increasing everyday and they are still trying to deal with it. Even China that brought the virus seems to have placed theirs under control as the number keeps on decreasing.

But if you’re going to be talking about Euro replacing Dollar, I don’t think that’s going to be happening, because once the US opens up their economy everything will boost back up again with higher speed than before and they will still go up to their position. Still many economic analyst are predicting about stagnant condition for USA economics incoming years due to various factors and their own policy must be one of them. It seems high man power country may move toward the position of top in terms strong economic conditions.

The situation in Japan is different from those in other countries. There are two main reasons.

1. The interest rates are extremely low (usually in the 0.00%-0.25% range). This allows the government to borrow more and more money, unlike the case in other countries.

2. Most of the Japanese national debt is being held by its citizens. The Japanese citizens are also some of the largest holders of national debt from other nations, especially the United States.

And Japanese Yen is one of the very few currencies to have increased its value against the USD. 4-5 decades ago, the exchange rate was like ~350 JPY to 1 USD. Now this is 107 JPY to 1 USD. There is no other currency in the world, which has appreciated by this much against the USD.

United State economic have down after get pandemic issues and now they are minus more than 20% and look terrible problem in their country right now, they will try thousand way how to bring back their economic after pandemic virus. United State have good power and will control all product to make economic recovery to normal.

We will see who is winning in this fight after several months after pandemic end. Too early to say something right now

Well, Europe is actually caring about their people and they are actually filling the hospitals and trying to not go outside too much and making sure that everyone who has to go outside wears a mask... like a normal response to a pandemic! Look at USA, they are actually leaving people to be, Jared Kushner literally dropped the testing numbers down just so the people in blue states could die, an unconfirmed gossip at this point but honestly I wouldn't be shocked but if you check out the number of cases in USA you can see that they have never really been great, they went from bad to recovering to horrible once again, people literally made mask thing a political thing for some reason even though in Europe right or left everyone wears it because it is not political at all.

That is not true. Europe had epidemic a week or two before New York. China had two months before. Epidemic in Europe started at start of March. Mid March spread over all south Europe and at end of March was everywhere.
In California and Washington state epidemic happened at same time at start of March. In New York they did not cared much what is happening at start of March then at end of March got huge headaches.  

So virus got to USA and Europe at the same time. Some parts of USA ignored it. They did not test enough or at all. That made it spread and brought huge costs and there will be more costs to tackle epidemic in the future.

My bad. I confused the Yen and Yuan :-X

What about now central banks increase their EUR reserves? The proportion of the dollar has been constantly dropping in the last decades. Of course it's still high, but it won't be sooner or later. While it was ~80% in the '70s it represents only ~50-60% nowadays.

Also many times Germany and Japan helped the USD to not seeing the US dollar depreciated, 30 or 40 years ago. Whitout that, maybe USD couldn't become what it is today.

That was a pretty good news for the part of Europe. Their government really did a great job of having coordination with one another to make a quick response to be able to control the situation of handling the rate of infection in their place which now enables them to open up their business establishments after quite sometime of having lockdown. This was really a great result when two parties do coordinate with one another.

On the case of US, even though there are already cases reported, it seems like they have underestimated the outcome of having a rise on the inflation rate of the spread of virus which turns out to end up like this making them to be on top of the world having the most cases of covid-19. Also, it is a challenge for the government of US to manage its people for they do also have a big population and the people and government are not well coordinated for they have complains among sides which makes it a lot more difficult to control the situation on implementing health protocols to prevent the further spread of virus.

A big country like US having most number of cases is really expected to have a struggle on their economy because of what their situation is up into now. Good thing that Europe have responded fast on the cases they have making them be able to control the situation which leads them to faster recovery of the economy. Actually at this time, it doesn't matter how fast the economy of each country recover because the important thing is that they can be able to recover once the situation is under control. It doesn't matter on which goes first and last what matters the most is the sake of the people of each country more than anybody else.

The target Fed Funds Rate is 0%-0.25%. The Fed balance sheet also just grew by $3 trillion in the past few months, headed for $10 trillion total in short order.


The context is falling confidence and value of the USD. How is owning US government debt a positive in this scenario?


First, that doesn't really address whether the JPY could become the dominant reserve currency.

Second, that was a direct result of two things:

• Specific US efforts at dollar devaluation in the early 70s, including ending the gold standard
• The signing of the Smithsonian Agreement in 1971, which fixed the USD-JPY exchange rate at ¥308 per $1

The price of JPY was kept artificially low during extreme dollar devaluation. This led to extreme imbalances in the forex market, which eventually led to a collapse of USDJPY when the currency peg was abandoned.

https://en.wikipedia.org/wiki/Japanese_yen#Undervalued_yen

Looking at the US economic sector and the US DXY index is on the red candle and currently have + 0.1% from yesterday. This is also almost the same when looking at the EXY quote although for the past few weeks the euro has gone very fast compared to $. the US economic sector is in trouble and forced to open pathways that increase their economic value but the impact is likely to be large namely the increase in co-19 impacts.

First of all, I felt glad to hear that Europe's economy is recovering fastly after all they've been true. Cheers to their Government for handling this Crisis so well.
But, on the other hand, I don't think that US dollar can be replace by Euro..maybe USA now is quite struggling because of being on top of highest positive cases in the world but I guess, they will get through this. US economy will be soon recovered because I believe that USA has unlimited resources and it will be easy for USA Government to find some ways to recover. They will remain as the king of the world despite the highest cases of covid-19 now.