Topic: Off Economic phenomenon. (Read 561 times)

Currency depreciation can result from factors like inflation, political instability, trade imbalances, and national debts. When countries have to face this problem, they usually have to do something drastic. These steps might include raising interest rates, decreasing government expenditure, and applying economic reforms. Although certain countries may deal with currency depreciation and high inflation rates efficiently, the difficulties could be intense and require major actions sometimes. To maintain a high quality of living for their people, nations should manage their economies properly and strive for stability.
In order to successfully address economic challenges, a combination of fiscal and monetary policies could be adopted, along with paying attention to the root structural problems in the economy. Knowledge about the factors influencing the decline of currency value and the rise in inflation, as well as the correct actions that should be undertaken, is indispensable for any country that seeks to maintain the prosperity and welfare of its inhabitants.

I have come to realise a long time ago that dollar is not the only factor that determines the prices of goods and services in a country. In a country where there are no agencies monitoring the prices of commodities in that country,  whosalers, retailers (especially middle men in the chains of distribution) can manipulate the prices of commodities and services and still make it look like it is the fault of the government. Maybe they are right, it is partly the fault of the government because they have failed to properly monitor what the business men do in  their countries. Most times,  these business men hoard goods, thereby causing artificial Scarcity so the people will pay huge amounts to get them since the commodities are scarce.

The difference in the present economic situation in countries will depend solely on how the government handles the situation and the policies put in place to ensure people do not suffer unduly.

I agree, especially on the last thing that you said, it's because the change in price for the currencies are also normal and this is what we called as fluctuations or volatility. Even the price of other goods can experience it too. Maybe if there is a major change in their price, that must be the time for us to be suspicious and think that the rates have officially changed and one of the cause of it is either the currencies value have increased or decreased, or it was the other way around, and this can be applied for quite some time.

It is still possible for us to take advantage of the price differences/change. Same principles can we apply here in crypto like obtaining/buying them at lows and then exchanging/selling them at highs.

There can be several factors leading to a currency depreciation, including high inflation rates, political instability, trade deficits, and high levels of national debt. In order to address this issue, countries often need to implement policies to stabilize their currency and control inflation. This can involve measures such as increasing interest rates, reducing government spending, and implementing reforms to improve the economy.

In my country, we have also experienced periods of currency depreciation and high inflation. In some cases, the government has been able to implement successful policies to stabilize the currency and bring inflation under control. However, in other cases, the situation has been more difficult to resolve and has required more drastic measures.

Overall, it is important for countries to carefully manage their economies and work towards stability in order to protect the standard of living for their citizens. It may require a combination of fiscal and monetary policies, as well as addressing underlying structural issues in the economy.

Having incompetent leaders has a big impact on the inflation rate. Because of his various incompetent decisions which have a direct impact on the country's economy. As happened in Argentina, where the country faced inflation and stagnant economic growth, this caused inflation in the country to increase to 250%, which weakened their currency and paralyzed the economy. Even though Argentina was once one of the 10 richest countries in the world, now they have fallen and become a poor country. This is why it is important to be able to choose competent leaders, because it is very crucial to the development of a country.

The prices of your country's goods and services aren't necessarily bound by the strength of the dollar. So the rise and fall of your local currency against the dollar doesn't necessarily determine the changes in the prices of your goods and services. The strength of your currency, of course, will have an effect on the affordability of the goods and services, but it isn't like you can take a look at the forex exchange charts now and then you go to the market right after to check how the changes reflect on the prices.

The status of a country depends on the contributions of the government and its people, when the economy goes down, it's both people's fault, not just one person's. People blame the government for only being corrupt and not paying attention to people's lives and the domestic economy. Meanwhile, people find ways to avoid taxes because they think the government does not help but wants to tax them. Since then, the economic situation has become increasingly worse because everyone selfishly thinks poorly of others and only cares about themselves.

Like you, you always say you want the country to develop and have a strong economy, but have you paid enough taxes and strictly complied with the law? None of us are very good at it, including me, and we like to blame the government. The fault is everyone's, don't just blame the government or the people and think you are innocent.

That is a sad reality, but who is to be blamed for that? I guess the governments and those who are in power and are misusing their powers by filling their pockets with the money they get from within their countries and then borrowing from other countries for development and other purposes. That is completely wrong but what can be done at the end of the day?


Such countries need to increase the production of goods within the country so that they can import goods as well to make the economy better. I'm pretty sure that any country in the world will have at least something to produce that they can export to get some funds in return for their economy.


Who doesn't want that?  Every citizen of a third-world or developing country would want their country to prosper and get out of all the bad economic situations so that they can live peacefully without any problems.

we cannot equate the economic conditions of each country, because political conditions, leaders' policies, and many other factors can influence the conditions of a country. for example, my country and its neighboring country, even though they are in the same region, the conditions of the two countries are very different, one is a developed country and one is a developing country. this is because their country's leaders are better at managing the country and are good at diplomacy, so it can provide economic benefits to their country.

but fortunately our country's economy has developed significantly, this is because our president has adopted appropriate policies and is able to read future economic opportunities and can provide added value through managing the resources that our country has. so maybe your country can imitate the steps taken by my country so that it can advance your economy.

Most times when their is change in government it really affect the economic aspect of the country as you said, many countries have suffered this because most new presidents are clueless instead concentrating on building a good legacy towards enhancing and setting a way of good economic system, they will be busy chasing shadows, am not against any new government fighting corruption in a transparent way but this should not make the leaders and his economic deviate from the main thing which is making economic policies that will strengthen the country economically to withstand inflation to an extent when it occurs.

It is sad to say that this is not only the situation in your country but many other countries are going through the same situation.
Many small countries have almost reached the point of default due to borrowing from developed countries.

The currency of debtor countries does not have the same value as the currency of developed countries. When the value of a country's currency falls, it has to buy goods from other countries at high prices, and when goods are imported at high prices, they are sold at high prices in the country due to which inflation rises rapidly.

Therefore, if any country wants to increase the value of its currency, it has to get rid of debt, which seems almost impossible considering the current situation.
I sincerely want my country to develop and not get into more debt and I believe that the people of every country want the same.

It's pretty normal, a thing that happens to all tourist centers!

You have tons of money entering the economy but you also have demand for goods, yeah you get wealthy but the demand and people paying even with increased prices for the stuff will drive up inflation, that's why hot tourist spots are quite expensive compared to the rest of the country even when it comes to Europe or the US, and that's also the reason there is no escaping this.

More tourists more need for housing, more tourists more profits, more income from rent, higher prices for houses!
More demand for food, but not enough supply, merchants know they will sell it even if they add 20% cause there is demand, higher prices!
Higher prices mean people demanding more for their jobs, increased prices again!
And it will not stop until a balance is achieved!

You exactly describe the situation that exists in my country. USD was rising, the price of food and everything was rising as well and then soon after the start of the war between Russia and Ukraine, local currency to USD exchange rate significantly went down and people became happy, the national bank even had to do something to make our local currency little bit weaker because it was getting too strong against USD. This happened because many rich Russians and Ukrainians flew to my country and they brought lots of dollars with them, this resulted in increased USD income in our country and local currency becoming very strong but this didn't cause a fall in prices of food and other things, quite opposite happened and absolutely everything become terribly expensive. This happened because we are an importer country (I assume your country will be an importer country) and demand increased, so high demand resulted in a price spike and for a bonus, since there is a monopoly and corruption on things like this, distributors that import food and other goods, decided to significantly increase prices and they are profiting a lot.

Apart from the fact that you're specific that you did answers from other countries citizens, I'm also from same country and perhaps I totally understand the current economic situation of the nation.

The current economic situation has been very very poor to the extent that it cannot be changed in just a few decisions but has to go through a lot to be normal again. The past governments of the country ruled the nation in a selfish manner that has lead to the high inflation of goods and services in the country and perhaps for it to be corrected it must go through some work which requires time, since the incubate government are working on bringing down the inflation rate the no matter the reduction in dollar rate it's expected that goods and services will go high in the first period of policy changes before it sets to fall for good.

This has lead our incubate president to make some announcements few times ago that they are working of inflation and perhaps the citizens will have to bear with them for some time before the price of goods and services will set to reduce. Thous he gave an example that when a is turn off for the first time it uses the same energy to rotate meanwhile it's off already so it will take some time to reduce and turn off permanently and is how the inflation of goods and services will take a little time before it will set to reduce to a better level.
I hope with this example you will understand better.

Which brings a recession and it is equally bad. What you are saying is:

"We can cure this cancer if we kill the patient. No patient, no sickness to cure."

Japan might have no inflation, it is because it is already a dead economy.

Yes we can cure the inflation if we kill the economy. Bravo Doc, you'll get the Nobel prize for this research.

Yeah, definitely!
You're forgetting that Japan has tried to fight deflation for decades and that finally seeing positive was a success story!
 

Nope!
https://tradingeconomics.com/greece/government-debt-to-gdp


Exactly my point as I said previously: If people don't spend no matter how much money you print you will have no inflation!

Averaged 0.8% but it is over 2% now. Do you think it will go down from there? Japan is an interesting case indeed though.


https://www.usdebtclock.org/world-debt-clock.html

Take a look at the public debt to gdp ratios. Japan is by far the leader with ~298%, the runner-up is Greece with ~226% and the third place belongs to Italy with ~171%.


This shit is crazy and trust me, you don't want to be Japan.

The aging population of Japan isn't helping either as older people don't buy the newest iphone or toyota very often. They use what they have till it breaks and Toyota's last to the grave  That huge pile of printed paper should bring huge trouble in the future if not today. When it does, it will be all fireworks.

Japan inflation

Inflation in Japan averaged 0.8% in the ten years!

Japan monetary mass


The monetary base double din the last 10 years and went 6 time sup in the last 20.

Bank can print one hundred quadrillion trillions and flood the amazon with cash, if nobody is using the extra cash to buy stuff but stores them in their accounts there will be no inflation.


Most? No, not even close!

I think a change of government and administrative reshuffling can be a contributing phenomenon to the economic situation of a country at any time, because a new government would try to tip the scale in their favour with new policies and systems.
While scrutinizing the former administration, they may create a lag and soonest, attention would be diverted to setting up panels or agencies that would require financing to function while other sectors of the economy will sit
idly waiting on outcomes of court cases and investigations ongoing.

Similar things happened in my country. Overall, the USD is just getting more and more valuable if measured against local fiat. However, sometimes there are temporary spikes which go way too high, and they are promptly followed by corrections. So, for example, from January to the end of February 2015, the USD went from being worth 15.6 UAH to 27.7 UAH. Then it dropped to 20.2 UAH by May of the same year, which is a drop similar to the one described by the op. Over the years, it went higher and lower occasionally, fluctuating between spikes and corrections. Maybe that's what's going on.

You did not even told us the name of your country so we cannot asses the whole situation with such little data, however even then it seems you are under the impression that such thing can be easily solved, but this is not possible, economic problems in a country are often the result of decades of mismanagement, and in order to solve those issues decades are needed as well, and that is if we were to assume politicians decided to do things right this time around for such a long period of time, an unlikely possibility without a doubt.

That's the wrong mindset, we pay our taxes to the government so technically we have a say on what to do with the gathered taxes, which means that it's our right to get what we deserve and that the government is obligated and it's their responsibility to comply to this things that we ask, yes you can't depend all of your needs to them but if they're not looking out for you, there's either something wrong with you and the people around you or the government or both, that's the excuse of many people that don't like the idea of handouts by the government to those that need the money, that they shouldn't be relying on them when that's what the people that controls us wants, that we turn on each other and make it so that they're giving out less help and they can further improve their legacy as a government officials.

Economic hardship is a global problem but each country problem is unique and different from others countries for instant your country economic situation may be due to lack of production of local goods and services if your country depends entirely on import and don't produce the basics house hold goods for her citizens the currency of that country will suffer in the hand of the dollar you have to produce and and become self sufficient then you export to others countries
Secondly you have to look at the leaders of your country if the economic decisions they are taking is friendly to economic growth or not because there are leaders who doesn't know anything called economy such as African countries leaders in that case the economy will suffer

The reason while other countries are doing better than others  is as a result of some countries not having love amogs themselves. Because love is one important thing in what ever thing we do. When there is love, people leave in peace and harmony and becomes productive. but when there is no love amog people, the country becomes devided. If you check Some best countries to, you will discover that it was oneness and unity that made them become a better country today without minding ethnicity, religious disputes, political crisis and many others. If they can be able to unit and forget about all that, I believe things will be ok.

It's easier for you to say all of this in paper than in practice under such dilapidation that an economy is experiencing.

How do you as a single individual thrive in a country that group's of private companies and industries are struggling to survive the continuous economic hardship forcing them to close business operations because they could no more meet up with cost of operation. How does a single individual survive it if they the companies are finding it hard to?

How do you as an individual depends on yourself for your own security in a social contract society when those saddled with political system has failed on their responsibility to protect lives and property. How can you as an individual survive under an insecure environment even if you are with entrepreneurial skills that should provide you a sustainable income source?

When the cost of goods getting increasing regularly following with constant devaluation of your country's currency value, how do you depend on yourself to survive under an economy like that if you don't have to depend on the government to solve and bring sustainable developmental solutions to these economic hardships?

Please @dunamisx brief me on practical ways as an individual without depending on the government how you can be dependent on yourself to survive sustainably under such a dwindling economy that's also bedeviled with gross insecurities.

I already read that you are from Nigeria, which is funny because I thought you were from Argentina where something similar happened recently, although only if we consider the "market" exchange rate (both legal and illegal) and not the officially controlled market which is difficult to access for buyers and thus has a lower price.

But as you asked for experiences from other countries: In the case of Argentina, the reasons of a decrease in the "real" USD/ARS exchange rate combined with an increase of the price level were varied but all were related to a government change:

- Before the decrease, price controls were in action. These were lifted by the new gov, giving freedom for companies to increase prices.
- A devaluation happened in late 2023 just before this phenomenon, which created an inflation shock for imported goods. But since then the government has barely touched the "official" exchange rate.
- At the beginning of the new administration there was uncertainty about the path the government would take. This drove USD/ARS "market" exchange rate to the moon, but then after first actions were taken, it fell.
- New government's measures have caused a recession; many people and companies had to sell dollar/forex reserves. This deflated the USD/ARS "market" exchange rate further.
- Inflation "inertia" was (and is) still in place, i.e. speculation about future price and wage increases didn't change.

All of these phenomenons were completely local, but they could happen in any country. The interesting thing in this case however was that these forces were so strong that they even countered a decrease of interest rates, which had risen to astronomical heights in 2023 (over 100%).

How could be "dealt with that"? The idea of the government is that a new equilibrium would be found between inflation, the USD/ARS exchange rate, and interest rates, creating conditions to retake economic growth, allowing basically an already-existing recession to deepen to stop inflation. But the problem is that much of these phenomenons have side-effects: For example, too many companies closing due to recession can lead to an exodus of skilled people and the reduction of economic diversification (need for more imports), which affects growth potential. Measures of this kind aren't "free". They can work, but also can not. To see if Argentina is a good example how to deal with such phenomena we must wait some months (or years) more.

Inflation is a global issue right now, though the situation is worse in some countries than others. Nigeria has quite a lot of problems with debt, lack of local production/exports, mismanagement of public funds/taxpayers money and really bad economic policies, and the government are only chasing temporary reprieve to all of these and more.

I don't think inflation can be "resolved" (to use your own words), though the government can take better decision to lower the rate of inflation, and unless they tackle the problem from the root, it would be futile or only produce respite.

At the end of the day, US economic policy will take into consideration all the external countries that rely on the dollar for trade (to keep it as the global reserve currency) but they first have a commitment to making the lives of American's better. That is why countries that rely on the dollar, often through unofficial or black market trade, will feel consequences from the US central bank. The one thing that is going on right now - investors are always looking to find decent returns without too much risk, for the low volatility part of their portfolio, and times have never been better to get that low risk debt from US government bonds paying close to 5%. If you imagine before the recent global inflation problems it was sub 2%, you can see why investors are piling in there and out of other less stable countries

I did not realize the situation in Nigeria is that bad, I read an article --> Why Nigeria's economy is in such a mess After reading the article I got some idea that you are oil making nation when I read it, I got only one question, why a nation which is the 2nd largest oil generating in the whole Africa is suffering. According to some statistics, your exports have improved in comparison to previous years.

With that saying, why money is not being made, would be due to many problems, like low-level education, people with no risk taking, money making, optimistic mindsets, but if the situations are bad then these are not going to be the ones that lack, the only thing that lacks is leadership and opportunities, they are giving to you, if not then you guys have to be independent of the government, learn new skills, join technology, provide services and start to earn money in $. Our country's situation is also very bad, the prices of everything have gone 2x to 3x in a few years. We have a hell lot of $ as debt on us. last time we were near to declared as default. We have riots among the political leader and they only work for money.

Things are difficult and in this situation many Pakistanis are flying abroad, earning in dollars and helping others too, some are becoming entrepreneurs and producing more employments, people are helping each other, this can solve some things. Overall, who is at fault, that's hard to know.

The government is not doing the right thing. Instead of thinking how to tackle inflation by repairing the refineries, and focus more on production in the country to lessen the right of inflation, they put the blame on the value of dollar over Naira. This has shown that they are not competent of the offices that they are handling.

The government should focus more on production and exportation, rather than importing almost everything that is used in the country. I believe the the Naira value would be in a short-term, because nothing is done to tackle the high level of inflation by the government.

I would believe we are from the same country because same situation you talked about are what my country face right now. The Naira which is the Local currency of my country was really fall compared to naira and was heading towards ₦2000 for $1 which is super crazy causing the price of goods and services to sky rocket leading to hardship in the country.
This situation is as a result of bad government with not strategy to handle the nation economy, to make matter worse the country decided to target Binance seeing it as the cause of the Naira Falling.

I think the situation is bad even if we are now seeing temporary progress in the value of Naira but not reflecting in the price of goods and services.

If there are regulations to subsidize the high exchange rate, then there should also be regulations on price control, but In a situation where there are only regulations to reduce rates and the aspect of price control is overlooked by the government, producers, wholesalers, and retailers will definitely sell as they desire. In the open market of retailers, prices might not really be properly managed, but from producers to retailers, if there are regulations for price control, it would help the retailers buy cheaper from their suppliers, which would enable them to sell at a less expensive rate to final consumers. 

So, what I am trying to let you know is that the exchange rate can be reduced, but when nothing is done to control the price of goods and services from the channel of distribution, it definitely will not reduce the price of goods, and the cost of living will not still look satisfying because everything that is needed to heal the inflation a bit has not been attended to. 

Dividend paying defensive stocks are the best inflation hedges imo.

First of all, they are defensive. Meaning they make products which people will always need and gonna buy. (Shampoo, toothpaste, toilet paper, water, drugs etc)

2- They can easily raise their prices, adjust them to the inflation rate and still sell their products without any problems. Meaning; they are recession-proof.

3- They pay dividends. Meaning; you’ll always have a cash income regardless of the financial situation in the world. It is important because we live in a cash world.

You can’t fix inflation. Nobody can. It is because these central banks are addicted to printing. However, You can protect yourself from it. It is not rocket science…

If you are not into stocks, buy bitcoin.

The exchange rate of naira to dollars is not the course of the economic hardship and the hyke in the price of goods and services within the country,  you should ask yourself this basic questions.

1: is the price of other trading currencies and assets not pricing above the dollars, e.g bitcoin for example is at above $68k+ and yet the United state government is not blaming bitcoin are they?

2: the problem relys much more on export rate against import rates?

Conclusion

Nigeria over dependence on  petroleum and importations of almost everything and low internal production of basic commodities is the major course of the hardship.

Now the naira is appreciating against the United state dollars, but yet the price of goods and services are still skyrocketing on daily basis.

This happens when the country is dependent on imports as over importing or importing more than export will cause the issue you have mentioned and if the export is increased the country will see more wealth flowing in thus reducing the inflation as well, you country needs more made in your country product it has to become a manufacturing hub for most of the daily needs and this is possible only when government incentivize some SME businesses and have incubation program for start ups.

This is not possible with corrupt leaders as they should be kicked out in first place to move towards progressiveness. 

Currently, most of the countries are into high inflation and the first world countries are dealing with recession. That's why the decrease in value of your fiat is there if your country is dependent on the value of USD or importing a lot. There's no way to stop inflation but it can be lessened and decreased yearly depending on many factors like as I've said, if your country has always been importing, it's hard to deal with it. But those countries that have food security and not reliant to the oil of other countries, then that means that they're making their own supply and economies for which they can't be affected by the rising factors of importation.

The economic situation would not have been affected by this crisis if there was less corruption. An unbridled trend of corruption has been observed in the last few years. Especially in various government projects repeated increase in project cost various irregularities unlimited corruption have eaten a large part of the growth of the country's economy. If corruption was less then the situation of the country could be different.

Honestly it's hard to pin point just one main or primary cause of an economic recession in a country. It is rather a chain of events leading one to another making the economic situation worse. If there are increase in the price of raw materials and the government not being able to do anything to prevent it it will be soon followed by an inflation period which in turn makes people hold on to their money more in fear of losing money but that will lead to a decrease in consumer thus making businesses suffer and in result will act on cutting employees leading to a loss of jobs. It all depends on a country and their strengths and weaknesses but this is generally how I understand economic recession happen.

These problems usually affect developing countries more.  A rise in the value of the dollar in developing countries has led to a depreciation of their currency and inflation.  Which has made their public life endangered and causing various problems such as increase in commodity prices.  People spend more than their income.  Inflation seems to be killing off these low-income countries.  They are unable to keep pace with the global market.

Cuba is one of the country that is facing unstoppable inflation due to the restrictions of US government, it is still on going so it's not possible what they did to stop the crisis but the increase of US dollars into the country helped the crisis a bit that also let the people to get what they wanted with their money but it's not possible for everyone, only who had the money even in the crisis can survive and others just have to stare at the government schemes to run their life.

AI will give you the answer that will be global phenomenal and that may only be theoritical and also making its solution so. Therefore, these issues are country based and not to be generalized. If government has stylishly caused the exchange rate to reduce then it possibly means they also caused it to increase in the first place. So you are going to look at corruption as a cause and that is why I said it is not global but country based.

Another factor to consider are how are the other economic indices functioning with the policies of government. Exchange rate must have to increase if there is pressure and demand for the major currency for import. This is a point to look at, how proficient is your countries.manufacturing sector and exportation of manufactured products? This is important to consider because forcing exchange rate down is not all but there must have to be good policy for natural growth of the economy and not artificial.

It's pretty simple since I saw you're from Nigeria.

Your government runs a budget deficit, so it runs on debt that needs to borrow funds.
Your country runs a trade deficit, which means that you need more hard currency to import than you get from your exports.
So you get the decline in Naira!

Now your CB raised in March the rates by 200 points 24.75%, just as a comparison, The US and EU are at 4,5 and 5,5 South Korea and China at 3.5 and Japan just increased it from -0.1 (yeah minus) to 0.

So just as the fed rising interest rates have strengthened the dollar your own CB rising them has strengthened the naira!

But as long as inflation is still at 31.7% those hikes won't do much.

There is no logical reason that all countries have to perform equally well.
Each Country has the government it deserves. You have mainly dumb people in your country? Look at the government.
That equation only works in societies where mostly fair elections happen.   

Maybe I didn't ask the questions properly, or  you probably didn't get me. The question is, can you explain this Economic phenomenon and give countries that had such an experience and what was done in order to stop it. It really doesn't matter if I am the one stopping it, or an NGO, or the the government themselves. Simply what was done to stop it ?

Also, this kind of economy makes it difficult for individual to thrive on their own, what advice would you give to people from my country who are still willing to increase their income regardless of the economy?

If your country's fiat is doing worse against the dollar means the government is printing more money or the paper money is not accepted for exchanges of other currencies or the reasons could be anything but its not in your control to make any changes that can bring positive effect its in the hands of government to make ways that strengthen the economic structure and further progress.

This currency devaluation is the same problem that most underdeveloped countries are facing because they have incompetent leaders who have no business being in the helms of affairs, they're so corrupt that they don't care if their economies are crumbling, so far they're enriching themselves. Most of these underdeveloped countries even with natural resources that is supposed to boost their economies still rely on foreign made goods and grants from developed countries to survive, instead of creating enabling environment for businesses to thrive and providing basic amenities like water, electric light and good roads. As long as mediocre and corrupt politicians are still rulling these countries, their currencies will keep depreciating and and turning to shitcurrencies.

The global inflation was a thing back in 2022 and 2023. Right now, the inflation isn't truly global, because the average inflation rates in the EU countries are around 2-3%. Maybe the rest of the world is suffering from high inflation, but the inflation in the European Union is pretty low.
I don't know in which country do you live. Turkey? Argentina? Some African country? It seems to me that the merchants in your country use everything as an excuse to raise the prices of goods and services. Maybe there isn't a truly functioning market economy where you live and the markets are controlled by cartels and monopolies. If there was a real competition between the merchants, the prices would go down, when the national currency goes up against the US dollar(this means that the imported goods and raw materials would become cheaper, resulting in cheaper consumer goods).

You may not have to depend on the government as well as stop comparing your country to others, you need to be independent on yourself because the government will not be responsible on how you have seen to economy for your own good, create time to find an alternative for yourself in the economy, don't be too dependent, work on yourself to have value and make effective use of these to your own benefits, things have always been that bad ever, but not being too dependent will make every economic conditions sustainable on you.

Correct me if my interpretation is wrong. From this information: (1) the dollar (I assume USD) exchange rate vs local currency went down 37%; (2) even though the USD rate went down, prices (in local currency) still went higher.

IMO, The continuous depreciation of local currency vs USD is a sign of massive inflation of the local currency (compared to the US inflation). Then, The USD exchange rate was intervened by the government so that it went down without the necessary fundamentals to support it. It means the inflation problem still exists. This means prices in local currency will still increase.

So what's the effect of a 37% decrease in the USD exchange rate?
- If goods and services are sourced in USD, then if the USD rates go down, the price of goods and services will go down as well. The problem is that if the goods and services are not sourced in USD then tweaking the exchange rate won't affect local pricing.
- If the government budget can't sustain the USD exchange rate intervention, the exchange rate will come back to the equilibrium price.

Economic explanations for recession and inflation in a country is different. However there are generic explanations for these issues.

I think that when there is a poor economic policy and implementations.

Also, incompetent leadership of the country and corruption.

Thirdly, more imports and non export.

Fourth, insecurity could also lead to it. It will make people scared of going out to do their business.

Fifth, interference from foreign bodies. When foreign bodies interfes in the economy of a country, they bring in their own solution instead of a local solution that will work locally.

---

Solutions
* Corrupt leaders should be punished
* More indigenous industries should be created and things should be locally produced and consumed. Then they should explore exporting their products outside to other countries.
* Fight insecurity.
* Solutions should be local. What works for the UK may not work for Ghana.

Good day everyone.
Where I come from, there's been harsh economic problems for a while now. It's no news, that there's a global inflation due to a few reasons, but even in the midst of all that, a lot of countries are still doing better than others, and the development rate isn't reducing as the standard of living is still by far well to do.

My country has been battling with the dollar exchange rates. It's been soaring high, making the prices of food and other commodities soar high as well. But recently, the exchange rates dropped by over 37%, and everyone became happy ( of course apart from those who earned in $), and the prices of goods and services even went higher, further decreasing the standard of living in the country.

Now, AI and search engines will only try to give me theoretically logical explanations, but I want something practical and out of experience from people of other countries. What do you think this Economic phenomenon is and what exactly is causing it? Has your country been in a situation like this throughout it's history, and how was it resolved?