Why Is It Worth Saving In Other Currencies?
One of the most comprehensive ways of communication and contact is money and phone calls. Generally speaking, countries with the same currency are either unified or allies. In the 21st century, this trend has not changed. The fact that some countries have similar currencies means that these countries still have something in common.
One of the common languages may be English, but one of the most common currencies is the United States dollar. English is a commonly used language for communication between people. Money is a way of communication between political entities. In this case, countries communicate to find common ground for negotiations.
The US dollar is one of the most popular currencies used by all countries/regions, but in most countries/regions, the US dollar is definitely not the main currency. To this end, we have formulated specific exchange rates for exchange rates and inter currency exchange rates. Many countries have their own currencies and currencies, but we usually use dollars and euros to travel or trade anywhere. This is the most popular couple in the world.
A coin has two sides.
Just as all real coins have two sides, so do different coins. The US dollar is the most commonly used currency for trading, measurement and purchase, and is strengthened by gold, so it is one of the most stable currencies. Another example is the euro. This is also common in Europe. Because all members of the euro area use the euro as their main currency. This means that although you live in Greece, you can travel to Belgium and have the same money without exchange.
The dollar/euro is undoubtedly one of the most famous currency pairs, but this does not mean that the value of some other currencies is not high. An obvious example could be sterling or Swiss sterling. Although some currencies are much lower than those mentioned above, their values are also lower. Differences between any currencies are important. This is particularly important for the country and its economy, as well as for those who trade with these currencies.
The main importance of currency exchange rate and continuous change lies in brokers and foreign exchange markets. The overall concept of the foreign exchange industry is a transaction based on value difference and value change. This is mainly about forecasting, but these forecasts follow a certain trend chain, caused by economic changes, inflation, depreciation, appreciation, etc. Traders in the foreign exchange market use new changes and possible results to open and clear positions one by one. This system is very simple. If the currency changes according to your forecast, you will earn considerable income. But the market is very active. Even the smallest social, economic or political events can turn the wheel.
Savings VS Currency Change
We obviously work to make a living, but we also save for ourselves or future generations. Some people may even save money for black days. In fact, we all heard that the dark day of novel coronavirus has come in 2020. Although the black days have lasted for a year. Some smart people care about their possible dark days and prepare for them by saving money.
These people proved to be smart, but some of them were smarter. People from other countries(not from the United States and the euro area) import in local currency, but they usually immediately deposit in local currency. But as mentioned earlier, some smarter people convert local currencies into international currencies such as dollars or euros. Another interesting fact that deserves attention is that during the global epidemic, currencies depreciated against the US dollar, which means that the US dollar’s position is more stable. What’s the meaning of this? This means that before the exchange rate upheaval, people who saved in their own currency lost a lot of money than they actually had.
Georgia is a very obvious example, located at the crossroads of Russia and Türkiye, neighboring Armenia and Azerbaijan. The country has Georgian lari, also known as the local currency of GEL. Although the currency has never been circulated due to the strength of the US dollar, its value has dropped significantly at present, and the value of US dollar is almost twice that of GEL five years ago. This means that people who save in regional currency have basically lost twice as much money as they can save. If they change everything into dollars or euros, they will have better interest rates first.
Global inflation is still continuing, and the position of the US dollar against all other currencies is strengthening. Everyone else is wondering whether these currencies can withstand the test of the US dollar or will depreciate soon. Anyway, this is a good lesson for those who are still considering saving but do not rely on the most stable index.
