why is the us dollar so low compared to the pound?

Answer 1

The U.S. dollar ISN'T backed by any silver, or gold. It is good strictly on the word of the U.S. Government, and many say that this is as worthless as a plugged nickel.

Answer 2

Two part answer:

1) The two currencies have different origins, were originally defined differently, and have never been equal, and there is no reason to expect them to be equal. People have trouble grasping this but there is no reason to expect one country's currency to have the same unit value as another's currency, anymore than apples should cost exactly the same per unit as oranges. The Brit pound was originally defined as 1 troy pound of silver. The US Dollar was originally defined as a certain number of grains of gold. Things have evolved from there, but the pound has always been "higher" than the dollar as an historical accident having nothing to do with the underlying economies.

2) If you're asking why the dollar has recently lost value to the pound in currency exchange -- lot of factors effect that. It does NOT mean that the US economy is slowing or is weaker than the Brit economy, or vice versa. The dominant factors are the rate at which foreigners invest in American assets (hence demand for the dollar); the rate at which Americans import goods from overseas (hence supply of dollars created in the US and spun out to the outside world); and probably various central banks' attempts to manipulate their own currencies by buying and selling dollars.

Answer 3

It is a result of Bush policies that have destabilized the US economy. He has forced America to borrow so much money from other nations increasing our debt enormously. By selling out debt it has lowered the value of our currency against the Euro and the Pound. It is not out of the question that the Euro will soon supplant the Dollar as the desired form of international currency. The worst part of it all is it really sucks for middle class Americans that want to travel to Europe or do business with Europe. It also gives China, one of the largest buyers of our debt enormous power of the US economy.

Answer 4

Because the US interest rate is low.
This causes investment in other Country's with higher loan rates. However, this also attracts more purchases of US goods because the cost is lower.

Answer 5

British interest rates look likely to rise,meaning a better return on Sterling.

(I may be wrong,I am a Bricklayer not an economist)

Answer 6

because the u.s economy is slowing down,the dollar allways falls to other currencies when the u.s economy slows down.

Answer 7

trader....
dollar high export loss, dollar low import high

Answer 8

its deliberately manupulated, for trade advantage