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Tamiku [17]
3 years ago
12

During the period 2001-2004 the U.S. Federal Reserve lowered nominal interest rates on the dollar by more than the European Cent

ral Bank (ECB) did on the euro, a move that most market participants viewed as temporary. What was the effect on the dollar-euro exchange rate?
Social Studies
1 answer:
Arisa [49]3 years ago
5 0

Answer:

The dollar depreciates against the Euro.

Explanation:

When the U.S Federal Reserve lowered nominal interest rates on the dollar as compare to European Central bank lowered on the Euro in the period of 2001-2004.The effect of this decision was that the dollar depreciated against the euro.Since the nominal interest rates on dollar are lower than as compared to that are on Euro.

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