US President Joe Biden dismissed the negative impact of a strong US dollar on the rest of the world. Instead, he blamed weak economic growth in some countries for dragging down the global economy. “The problem is the lack of economic growth and sound policy in other countries, not so much ours,” he explained. He said the US strong-dollar policy had nothing to do with it and added that the US “economy is strong as hell.” Biden admitted that inflationary pressures in other countries might be higher than in the US. Yet, it is hard to downplay the impact of the strong greenback on the global economy. According to the International Monetary Fund (IMF), a rise in USD is a negative factor for the majority of countries. Since early 2022, the US dollar has climbed to its highest level in almost 20 years. Thus, it has advanced by 22% against the Japanese yen, by 13% – against the euro, and by 6% – against emerging market currencies. The IMF believes that the energy crisis caused by sanctions on Russian crude imports is also fuelling the rally of the US dollar. At present, almost 40% of international global transactions are invoiced in USD which makes it difficult for many countries to halt soaring prices. Some states have to resort to monetary injections to ease inflation. However, the IMF notes that this measure has little or no effect. JPMorgan Chief Executive Jamie Dimon said that the US and the global economy could slip into a recession in six to nine months. He pointed out that Europe was already on the brink of an economic downturn. Earlier, World Bank President David Malpass and International Monetary Fund Managing Director Kristalina Georgieva also warned of a growing risk of a global recession.
