Wednesday, May 6, 2009

Made in China, so what's the problem?

I remember reading this article a couple of days ago on how the prices on imported merchandise here in Sweden may skyrocket, due to the weak Swedish krona against euro and dollar. I might be wrong here, but how many of the products we buy in Sweden are actually made within the EU or the USA? Aren't most things "made in China" or similar low-cost countries?

I had a look at the exchange rates for the Chinese Yuan over the last 180 days, and it peaked late February, early March, it has fallen like a stone lately, to levels from early November last year.

Actually, the US dollar has also fallen sharply lately, and is down at early November 2008 rates, at 7.93 kronor/1 dollar (versus 9.29 at it's peak).

The only currency that has held its position against the Swedish krona is the Euro, although it has retreated massively since its peak late February, early March:

So any hyper inflation at this point would not have to do with currency exchange rates, that seems pretty obvious to me at least (although I'm just a simple, uneducated man). Let's hope Swedish merchants don't start a downward spiral of inflation and higher interest rates just for the sake of improving their margins.

The graphs are from

No comments:

Post a Comment