The Fed Acts. Workers in Mexico and Merchants in Malaysia Suffer

3/16/2017 The New York Times

maquiladora1CIUDAD JUÁREZ, Mexico — Francisca Hervis Reyes and her family have persevered on the border, working in factories more than 1,300 miles from their hometown. They remained even as deadly warfare between drug cartels turned this city into one of the most dangerous on the planet.

But they may not endure the changing predilections of the Federal Reserve.

Ms. Reyes is paid in Mexican pesos, a currency that has been losing value as the Fed, the central bank of the United States, has signaled plans to raise interest rates this year. In the parched terrain just south of the United States border, the prices of food and other necessities follow the dollar, whose value has been climbing. It is as if the Fed has slashed her pay.

Like millions of other people from Southeast Asia to Africa to Latin America, Ms. Reyes and her family are absorbing the consequences of a major shift playing out in the global economy.

Read more…


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