Why Hasn’t a Weak Dollar Slowed Imports?

The dollar is dropping against other powerful currencies, but the appetite of US consumers for imported goods continues to grow. The ever-surging demand for imports is partly driven by fashion and trends, as in the case of jewelry made in Austria and China, which is being sold in the US in ever-greater quantities. Environmental awareness has also played a role, as US consumers select imported goods which are more energy-efficient, such as front-loading washing machines manufactured in Europe. But far more significant is the importation of industrial parts which are used to make goods assembled in the US. If a foreign part is used to produce a good, even if the company is American-owned, the finished good counts as an import. An additional factor in the import surge is the increasing presence of US firms abroad. The prevalence of foreign goods in the US market is not always immediately apparent, but as US output rises so does the amount of imported parts used in production. When coupled with a widespread consumer preference for imported finished goods, the import surge is unlikely to slow down anytime soon, despite the sagging dollar. – YaleGlobal