Final answer:
The U.S. dollar has depreciated against the euro, as evidenced by the decrease in the amount of euros received for one dollar from yesterday to today. Historical trends show how exchange rate fluctuations affect trade and economic outcomes, with a weaker dollar encouraging U.S. exports.
Step-by-step explanation:
The U.S. dollar-to-euro exchange rate changed from 1 = 0.921384 euro yesterday to 1 = 0.891560 euro today. When the number of euros that can be exchanged for one U.S. dollar decreases, this means that the U.S. dollar has depreciated against the euro. This implies that the euro has strengthened, not weakened, against the dollar as you now get fewer euros for each dollar compared to yesterday.
To give you a better understanding of this concept, consider the historical exchange rates and their impact. For instance, in 1999, the euro was valued at $1.06/euro, and by the end of 2013, it had risen to $1.37/euro, showing a strengthening of the euro against the dollar. This shows that as the euro gets stronger, it becomes less advantageous for European firms exporting to the U.S., as they receive less for their exports when converting dollars back to euros.
Understanding the movements in exchange rates is crucial for businesses and the economy, as they affect international trade and can lead to different economic outcomes. A weaker U.S. dollar can encourage exports as U.S. goods become cheaper for foreign buyers, but it can also increase the cost of imports for U.S. consumers and businesses.