Visualizing Currencies’ Decline Against the U.S. Dollar
In a highly volatile and difficult year for many currencies and equities, the U.S. dollar has been a safe haven for investors.
The greenback has provided exceptional stability, with almost every currency around the world declining against the U.S. dollar in 2022.
This graphic visualizes almost 50 years of the Dollar Index’s returns along with the decline of major currencies against the U.S. dollar in the past two years using price data from TradingView.
U.S. Dollar and Major Currencies’ Returns in 2022
As shown in the graphic above, the past two years have seen nearly every major currency lose value against the U.S. dollar.
One of the currencies hit hardest is the euro, which briefly fell below parity (meaning the euro was worth less than one U.S. dollar) in September and October of 2022, before recovering with a 5.3% rally in November.
|Currency||2021 Returns||2022 YTD Returns|
|Japanese Yen (JPYUSD) 🇯🇵||-10.4%||-14.7%|
|Indian Rupee (INRUSD) 🇮🇳||2.0%||-9.6%|
|Pound Sterling (GBPUSD) 🇬🇧||-1.1%||-8.0%|
|Chinese Yuan (CNYUSD) 🇨🇳||2.7%||-8.6%|
|Euro (EURUSD) 🇪🇺||-7.0%||-6.0%|
|Canadian Dollar (CADUSD) 🇨🇦||0.7%||-6.6%|
|Australian Dollar (AUDUSD) 🇦🇺||-5.7%||-5.2%|
|Swiss Franc (CHFUSD) 🇨🇭||-3.0%||-1.1%|
2022 YTD Returns as of December 14th 2022. (Source: TradingView)
However, the Japanese yen was the major currency hit hardest, having fallen more than 25% since the start of 2021. At the yen’s lowest point this year in October, the currency breached 24-year lows, resulting in the Bank of Japan intervening with $42.8 billion to support the country’s falling currency.
The Swiss franc and Canadian dollar have been the most resilient major currencies against the U.S. dollar since 2021, largely due to the financial and political stability of those nations. Along with this, Canada has benefitted from surging crude oil prices in 2022, exporting the majority of its crude oil across its southern border to America.
Three Reasons for the U.S. Dollar’s Strength in 2022
A variety of factors have contributed to the U.S. dollar’s strength in 2022. The rapid raising of interest rates by the Federal Reserve and tightening of their balance sheet has resulted in U.S. dollars becoming a more scarce and valuable yield-bearing asset.
As interest rates have risen, so have yields for savings accounts and fixed-income securities like U.S. treasuries, making them a more attractive alternative for investors.
At the same time, falling equity prices (especially in the technology sector) only further incentivized investors to pull out of riskier equity markets into the safety of the dollar.
Lastly, compared to many other global economies, the U.S. economy has remained resilient with the fewest risks on its horizon. Europe continues to face an ongoing energy crunch with the Russia-Ukraine conflict nearby, while China’s zero-COVID policies have hampered the country’s manufacturing sector, as well as other industries.
How Will Currencies Fare in 2023?
While the U.S. dollar has surged for much of 2022, its rally has started losing steam in the final months of the year.
In September of 2022 the Dollar Index was up 20% on the year reaching a high of 114.8, but has since retreated and given back more than half its gains for this year so far.
Investors around the world will be watching closely to see if the U.S. dollar’s rise will continue, or if this end-of-year reversal will carry through and provide major currencies some relief going into 2023.
Mapped: How Much Does it Take to be the Top 1% in Each U.S. State?
An annual income anywhere between $360,000-$950,000 can grant entry into the top 1%—depending on where you live in America.
How Much Does it Take to be the Top 1% in Each U.S. State?
There’s an old saying: everyone thinks that they’re middle-class.
But how many people think, or know, that they really belong to the top 1% in the country?
Data from personal finance advisory services company, SmartAsset, reveals the annual income threshold at which a household can be considered part of the top 1% in their state.
Some states demand a much higher yearly earnings from their residents to be a part of the rarefied league, but which ones are they, and how much does one need to earn to make it to the very top echelon of income?
Ranking U.S. States By Income to Be in the Top 1%
At the top of the list, a household in Connecticut needs to earn nearly $953,000 annually to be part of the one-percenters. This is the highest minimum threshold across the country.
In the same region, Massachusetts requires a minimum annual earnings of $903,401 from its top 1% residents.
Here’s the list of all 50 U.S. states along with the annual income needed to be in the 1%.
|Rank||State||Top 1% Income|
|Top 1% Tax Rate
(% of annual income)
California ($844,266), New Jersey ($817,346), and Washington ($804,853) round out the top five states with the highest minimum thresholds to make it to their exclusive rich club.
On the other end of the spectrum, the top one-percenters in West Virginia make a minimum of $367,582 a year, the lowest of all the states, and about one-third of the threshold in Connecticut. And just down southwest of the Mountain State, Mississippi’s one-percenters need to make at least $381,919 a year to qualify for the 1%.
A quick glance at the map above also reveals some regional insights.
The Northeast and West Coast, with their large urban and economic hubs, have higher income entry requirements for the top 1% than states in the American South.
This also correlates to the median income by state, a measure showing Massachusetts households make nearly $90,000 a year, compared to Mississippians who take home $49,000 annually.
How Much Do the Top 1% Pay in Taxes?
Meanwhile, if one does make it to the top 1% in states like Connecticut and Massachusetts, expect to pay more in taxes than other states, according to SmartAsset’s analysis.
The one-percenters in the top five states pay, on average, between 26–28% of their income in tax, compared to those in the bottom five who pay between 21–23%.
And this pattern exists through the dataset, with higher top 1% income thresholds correlating with higher average tax rates for the wealthy.
|State Ranks||Median Tax Rate|
These higher tax rates point to attempts to reign in the increasing wealth disparity in the nation where the top 1% hold more than one-third of the country’s wealth, up from 27% in 1989.
Markets3 weeks ago
Charted: Six Red Flags Pointing to China’s Economy Slowing Down
VC+1 week ago
What’s New on VC+ in September
Markets3 weeks ago
The 25 Best Stocks by Shareholder Wealth Creation (1926-2022)
Brands1 week ago
Ranked: The 20 Best Franchises to Open in the U.S.
Money3 weeks ago
How Much Does it Take to Be Wealthy in America?
Markets7 days ago
Ranked: The Highest Paid CEOs in the S&P 500
Retail3 weeks ago
Visualizing the Number of Costco Stores, by Country
Markets6 days ago
Charted: Market Volatility at its Lowest Point Since 2020