Finance C1 Essay Example | Topics and Well Written Essays - 1250 words

Finance C1 - Essay Example ence on the textile import from Asia especially from China, Pakistan , India and Bangladesh coupled with China’s traditional superiority in producing cost effective products gave EU a opportunity to increase its trade volume with the region and with it the currency of the trade also. The recent economic happenings in the world economy are clearly suggesting a weakening American economy which is lingering from its subprime crisis and now seems to be engulfing into the energy crisis as the oil prices have started to raise also. The overall situation suggests a different story, a new feature, and new rules of the economic superiority in the world. Though the US is the largest single economy in the world however, its neighboring countries are not that powerful in terms of their economic standing therefore any kind of regional pacts such as EU may not provide a more and better economic power to US to further influence the world economy. In the spring of 2008, dollar traded nearly at $1.6 per Euro suggesting the slide of Dollar against the Euro in the recent past. The rising dollar against the Euro as well as a mild to medium recession into the US economy is suggesting a hint of decrease in the overall competitiveness of the US economy. The consistent slide of dollar in the international market against another major currency suggest that the future may develop itself into a new face where the currency of competition within the international markets may no longer remain as dollar but may very well see Euro as the major currency for trade in international market. The British Prime Minister has recently said that all the Europe will combine together to bail out the current crisis into the international markets and many observers view this statement within the context of the dominance of the EU over the world markets if it succeed in bringing the required stability into the world economic markets. (Rhodes, 2008). The qu estion whether the Euro will lead the future