Why is the US$ still at $6.2? when it is falling against the Euro and the price of oilis $102.54/bar?

Question

It just seems to me (small person in the street) that if our oil revenues increase, that the CB would no longer need to regulate (float) our currency against the US$ any more and the rate should drop to about $4. Or is it that our gov't isn't putting this increase into our reserves.

Answer 1

Countries that want to do business with the US often link the currencies.  Japan, Korea, China export a lot to US.  The dollar changes very little as goods from these countries will cost more in the US.  I imagine T&T depends a lot on  tourists.  If tourists see their purchasing power dropping in T&T, they may go to Mexico instead.  It is a global ecomony.

Answer 2

I don't think that T&T depends heavily on tourists at all.

I also think that the U.S $ should drop to at least $5, and it could be a bad thing to have our tt$ pegged to the u.s$ seeing they are going through an economic slump right now, but!!!!