Data reveals economic shift.
New research from City Index has analysed countries with the highest GDP and local currency strength against the USD to highlight which currencies have shown the largest growth following the economic disruption caused by the COVID-19 ‘pandemic’.
The research looked into the latest data available from IMF.org to rank the 50 largest world economies in terms of GDP growth, and then analysed the currency recovery of the top 28 economies by tracking United Nations data on operational exchange rates against USD.
To shed light on the countries that have recovered the most, the experts at City Index utilised historical GDP data of the 50 biggest economies worldwide and calculated the increase in GDP between 2020 and 2023, in order to uncover the economies that have strengthened the most post COVID.
Unfortunately, it is not good for Australia.
Our AUD ranks fifth among the currencies that has lost the most in strength after the pandemic.
Take a look at the research below:
Currencies that have weakened against USD the most post-COVID:
|Country||Currency||Increase in GDP between 2020 and 2023 ($ billion)||GDP percentage increase %||Local Currency Operational Exchange Rate (to USD -2020)||Local Currency Operational Exchange Rate (to USD -2023)||Currency Strength Change %|
|Israel||Israeli New Shekel (NIS)||126||30%||3.42||3.59||-4.73%|
|Russia||Russian Ruble (RUB)||575||39%||73.17||76.75||-4.67%|
|United Kingdom||Great British Pound (GBP)||452||17%||0.78||0.81||-3.92%|
|Australia||Australian Dollar (AUD)||347||25%||1.45||1.48||-2.20%|
|Chile||Chilean Peso (CLP)||104||41%||790.75||805.73||-1.86%|
|Vietnam||Vietnamese Dong (VND)||103||30%||23,227.83||23,513.82||-1.22%|
|Canada||Canadian Dollar (CAD)||442||27%||1.34||1.35||-0.36%|
|China||Chinese Yuan (CYM)||4511||30%||6.90||6.91||-0.12%|
|Switzerland||Swiss Franc (CHF)||131||18%||0.93||0.91||+2.48%|
|Singapore||Singapore Dollar (SGD)||167||48%||1.38||1.34||+3.33%|
|Mexico||Mexican Peso (MXN)||573||53%||21.83||18.23||+19.72%|
Yes, despite sitting on a moral high horse and bragging about our ‘economic strength’ during COVID, Australia’s dollar has significantly weakened against the USD as we emerge from that period.
All we saw here was mass handouts to combat the economic bloodshed, which in turn has only lead to even more troubles post-lockdown period for the Australian people.
And it may be even worse, as this data was collected in July 2023.
Just this week, we witnessed the AUD sink to a nine-month low at US63.63¢, after data revealed the unemployment rate climbed to 3.7 per cent in July, and the number of people in work fell by 14,600.
With Australian financial regulators announcing they are preparing for “economic turmoil”, Australia is certainly not in the best position to withstand any major upheavals in the world.
This is evident in the current changes themselves, with Australia’s woes this week occurring due to us being so tied to China’s economy (and decline), and the significant investments we make with them.
Meanwhile, countries like Mexico are sitting in a fantastic position moving forward.
Aren’t we supposed to be the ‘first world nation’?
WINNERS AND LOSERS
As we can see, the Australian dollar is among the currencies that weakened the most since the pandemic, with a 2.20% decrease against the USD.
This is almost as bad as the ‘motherland’, the good old U.K, which have suffered a 3.92% decrease.
The Israeli New Shekel (NIS) has lost the most strength since the pandemic, with a 4.73% decrease recorded according to the research.
On the flip side, the fastest recovering currency is the Mexican Peso, with an increase of almost 20% post-COVID, and a 53% increase in GDP.
With an impressive increase in GDP of $573 billion from 2020 to 2023, and larger capital investment from the US and China, the peso has managed to strengthen very nicely.
Singapore’s currency strength places second in the data set, increasing by 3.33% since the ‘pandemic’.
In third place is Brazil’s Real, which has increased its strength by 2.77% post-COVID. The recent strength is partially down to the rise in the price of industrial metals and agricultural products, contributing to a $605 billion increase in GDP between 2020 and 2023.
It seems Brazil didn’t sell off all their industrial resources with sovereignty-killing trade deals like Australia did with the Lima Declaration, and it has helped them immensely to maintain national production.
We will see how the Land Down Under fairs the next few years as we steamroll towards Agenda 2030.
What do you predict the next few years will hold economically?
Make sure to leave your thoughts below!
- To discover the currencies that have strengthened the most post COVID, a seedlist of the 50 biggest economies by gross domestic product was taken from IMF.org.
- The GDP data from 2020 and 2023 from these countries was then used in order to calculate the largest GDP increases and decreases per country from pre and post COVID.
- City Index then analysed local currency operational Exchange rate to USD for 2020, and 2023 using Treasury.un.org, and calculated the currency strength change post COVID.
- All data was collected in July 2023 and is subject to change.
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