Strong dollar policy leads to depreciation of currencies in many countries

The U.S. "strong dollar policy" is the main cause for the substantial depreciation of currencies in many countries, especially those emerging economies, according to analysts.

The policy leads to the U.S. dollar appreciation, drawing capitals back from the emerging markets. This will put emerging economies as well as global economy at risk.

Several countries in Asia have been suffering from it, such as Japan, South Korea and Indonesia, analysts say.

The Japanese central bank on Friday maintained its policy rate unchanged.

The Bank of Japan (BOJ) decided to guide short-term interest rates in a range of zero and 0.1 percent, a month after it ended the negative interest rate policy in its first rate hike in 17 years.

The announcement weakened the country's currency against the U.S. dollar significantly.

According to a media report on Monday, the exchange rate of the yen against the U.S. dollar dropped sharply, hitting the lowest level in 34 years.

Since currency is the medium of exchange, its stability has played a crucial role in business, trade and livelihood. Especially under the circumstance of globalization, the substantial currency depreciation in a short period of time will cause severe impacts on nations.

In Japan, the depreciation has led to rising import costs and higher consumption spending. Some local analysts believe that prices of food and gasoline will grow again.

Since its food and energy highly rely on imports, South Korea has been suffering from high inflation due to the depreciation of its currency -- South Korean won.

Not only has it put more burden on people's livelihood, but also has triggered capital outflow as well as disturbance in financial market.

For countries like Indonesia and Vietnam which often have deficits, as well as high inflation rates and external debts, the depreciation of their currencies has made their repayment of debt and interests even more difficult, posing greater risks to their economic stability.

Strong dollar policy leads to depreciation of currencies in many countries

Chinese President Xi Jinping and Russian President Vladimir Putin on Thursday signed and issued a joint statement on deepening China-Russia comprehensive strategic partnership of coordination for a new era on the occasion of the 75th anniversary of the establishment of diplomatic ties between the two countries.

The statement pointed out that the two sides will promote the all-round development of the China-Russia comprehensive strategic partnership of coordination for a new era with head-of-state diplomacy in a leading role. The two sides will fully implement important consensuses reached by the two heads of state, continue to maintain close high-level exchanges, ensure the smooth operation of governmental, local and non-governmental exchange mechanisms, and actively explore new cooperation channels, it said.

The statement emphasized that the two sides are willing to continue to deepen cooperation in various fields in accordance with the principle of mutual benefit and win-win outcomes, work closely together to jointly overcome external challenges and adverse factors, improve the efficiency of bilateral cooperation, and achieve stable, high-quality development of cooperation. Both sides are willing to work together to actively expand people-to-people cooperation, enhance the level of cooperation, and expand cooperation results, it said.

The statement pointed out that both sides believe that people of all countries share a common future, and no country should seek its own security at the expense of the security of other countries. Both sides expressed concern about the practical challenges to international and regional security and pointed out that in the current geopolitical context, it is necessary to explore the establishment of a sustainable security system in Eurasia based on the principle of equal and indivisible security.

Xi, Putin sign, issue joint statement on deepening China-Russia comprehensive strategic partnership of coordination for new era