The strength of the U.S. dollar relative to other currencies depends mainly on the performance of the U.S. economy relative to other economies.
The nominal GDP and net worth of the entire world are held by the United States, which has a highly developed mixed-market economy. After China, it has the second-largest economy in terms of purchasing power parity (PPP). As of 2022, its nominal and PPP per capita GDP ranks eighth and seventh, respectively, in the world. In 2022, the US's PPP share of the world economy will be 15.78%. The world's most innovative and technologically advanced economy is found in the United States. The technological advancements made by its businesses, particularly in artificial intelligence, computers, pharmaceuticals, and medical, aeronautical, and military equipment, are at the forefront or very close to it. The U.S. dollar, which is supported by its robust economy, stable government, and strong military, is the currency that is most frequently used in international transactions and is the world's most important reserve currency.
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