Did you know that the Internet was invented in the United States?
U.S. is full of other interesting facts, ideas and inspiration. If you are planning to travel to America be ready for a memorable experience.
Money is a major concern for anyone, whether travelling for business or going for a vacation. To have the best experience and have it remain the best, you must not let poor money management take the center stage.
In this article, there is information about the currency and how to manage it.
Tip: Familiarize yourself with the currency before you reach your destination.
The U.S. Dollar as we know it
Being the strongest and the most powerful currency, the U.S. dollar is underwritten by the United States of America, the third largest economy of the world.
The U.S dollar is accepted throughout the world in term sic trade, therefore making it a global or reserve currency. Approximately 65 percent of the total dollar bills in circulation, amounting to about $580 billion are used outside the country. Various currency trade charts of 2018 conclude that out of the total 185 currencies of the world, dollar covers about 90 percent of the foreign exchange trading.
Seven other independent countries have adopted the U.S. dollar as their official currency of exchange: Ecuador, Republic of El Salvador, Republic of Zimbabwe, Democratic Republic of Temor-Leste, Republic of Palau, Marshall Islands and the Federated States of Micronesia. The British Virgin Islands and British Turks and Caicos have also been added to the list.
Apart from being widely accepted for trade and commerce in Canada and Mexico, the U.S. dollar is accepted in various other tourist destinations.
Many countries are pegged to the U.S dollar in order to maintain economic stability.
The Federal Reserve is the central bank that is responsible for the circulation of the currency.
The Symbol of U.S. Dollar is USD and is denoted by ‘$’.
History of the U.S. Dollar
The Bretton Woods Agreement was created and signed in 1994 that replaced the gold standard with U.S. dollar. It gave the authority to create and ability to print dollar only to America. Since then, dollar became a global currency. As per the agreement, central banks of other currencies are required to maintain fixed interest rates between their home currencies and the dollar.
US dollar broaches the U.S currency. Started as a coin whose worth is determined by its weight in gold or silver to a redeemable paper note to replacing the gold standard in the 1970s to being one of the strongest currencies of the world.
Fun fact: Even today the actual value of US dollar is represented by credit. This serves as an emblem of faith in the strength of the U.S. economy.
The U.S. Treasury Department’s Office of Printing and Graving is authorized to print the bills and coins.
The U.S dollar is filled with cryptic symbols including an American eagle that is flying free, a banner with ‘E Pluribus Unum’ written on it meaning ‘Out of many, one’. The incomplete pyramid symbolizes strength and longevity.
In total, there are eighteen denominations in U.S. bills and coins:
The six U.S. dollar denominations produced in the form of coins include:
- Penny: a penny is worth one cent and due to high minting charges, many have voiced their opinion about getting rid of the penny.
- Nickel: the total cost incurred in producing and distributing nickel is 6.6 cents.
- Dime: more costly than the penny and nickel, a dime is worth 10 cents, however its production cost equals 3.33 cents.
- Quarter: making and distribution cages per quarter amount to 8.24 cents and is worth 25 cents. It was first minted in 1932
- Half Quarter: a half quarter is worth 50 cents. During 1932 to 1964, the half quarters, quarters and dimes composed of 90 percent silver and 10 percent nickel!
- Dollar: The worth of one U.S. Dollar coin is 100 cents. However, they are not very popular among the crowd today.
The twelve denominations of U.S. Dollars produced in the form of bills include: $1, $2, $5, $10, $20, $50, $100, $500, $1000, $5000, $10,000 and $100,000. However, the larger denomination: $500, $1000, $5000, $10,000 and $100,000, are no longer being printed, these are still deemed legal tender.
Factors affecting the U.S. Dollar
There are several factors that affect the USD, however some of the most significant ones include:
- Gross Domestic Product: GDP is directly proportional to the interest rates. High GDP means higher interest rates, which ultimately leads to increased foreign investment that has a positive effect on the value of the dollar.
- Trade Balance: trade deficit is the difference between U.S. exports and current value of U.S. imports. When the value of imports is higher than that of exports, it leads to a decrease in the value of the USD.
- Nonfarm Payroll: the U.S. labour bureau of Labour Statistics produces the Nonfarm Payroll Employment Report. This report contains monthly information about the jobs added and the ones lost. Higher and speedy job losses weaken the value of the USD.
- Sales (Retail): the retail sales are directly proportional to the value of the US Dollar, which means that the higher the sales, stronger the dollar.
Given below is the value of USD in terms of INR for the year 2019:
Your U.S. dollars
Taking cash (exchanged currency) from home can get a little strenuous therefore; you might want to opt for Forex cards that are readily available online.
A prepaid Forex Card can make your trip cost effective as they are a smart and safe way of carrying money.
Like the U.S. currency bills and coins say, ‘E Pluribus Unum’, meaning out of many, one. So be the smart one. Carry Forex cards and use your money wisely and smartly. Keeping a Forex travel card handy will save you from the hassles of looking for dollar bills for every transaction and payment.