So the Oil in US hit a new high this morning as it went beyond $90 a barrel (it fell later though). Dollar hit a new low against the Euro at 1.425 $/Euro.
On the one hand the clout of Chinese trade is growing. On the other, Chinese Yuan is pegged against US dollar. That means the Chinese exports to Europe are cheaper now and European exports are expensive to China! That does not augur well for Europe. So they are worried.
This worry is not there for US as much as the Chinese imports remain at the same price – thanks to the artificial price of Yuan!
So, which way will the it go on from here in the US?
Liquidity going down
Inflation going up
Deficit going up
Stock market may crash?
Banking sector will be restricted
In the medium term, the exports will rise to Europe etc