The strengthening US dollar against other foreign currencies such as Euros, the Japanese Yen and others has a strong impact on the global markets. The international currencies are being recorded at historic lows against the US dollar. Recently, one euro’s cost was $ 1.02, one British pound, $ 1.20; and one Japanese yen, $0.01. The US dollar has been appreciating against other international currencies for the last year, which is attributed to the following reasons. A major reason is the decision of the US central bankers at the Federal Reserve to increase the interest rates to curb inflationary pressures. There has been an increase in the interest rate thrice by the Federal Reserve this year in the range of 1.5 to 1.75 per cent. This rise has led to an increase in the value of the currency of the US and has attracted more foreign investment. Eventually, the US dollar gained a stronghold. The increased investment by the global investors in the US, owing to uncertainty in the investment market created by the Russia-Ukraine war, has led to an increase in the strength of the dollar. It is disillusioning to note that it has accelerated the burden on the poor-indebted nations bound to pay back loans denominated in dollars. The implications of the strengthening dollar have a mixed impact on the global markets. The goods imported from countries, whose currencies have devalued relative to the dollar, become less costly. This is especially true for the US markets. The decreasing import bill will eventually be a relief to the consumers in the US amidst inflationary pressures. Nevertheless, the trade deficit is likely to expand further for the US as the exports will become costly due to the strengthening dollar. The manufacturers of goods in America and exporters will be at stake due to increased export prices as the rate of the dollar accelerates. In the process of reducing inflation, the Federal Reserve has been increasing the interest rate, which has its own cost of accelerating the already high trade deficit of the US. The competitiveness of the goods of the US has been decreasing on the global front. The increased investment by the global investors in the US, owing to uncertainty created by the Russia-Ukraine war, has led to an increase in the strength of the dollar. The UK and the Eurozone economies have encountered the worst inflationary effects resulting from the strengthening dollar. The worst effects of rising inflation are experienced in the western nations, especially after World War One. The political backlash has been enormous whereby the Italian premier resigned, and early elections had been announced. The nationwide strikes had been predominant, particularly in the UK, which has been an obstacle to the economic development of the country. Furthermore, there are other international implications of the strengthening dollar. The emerging economies of the world have been undergoing an adverse impact as the strong dollar has led to slow economic growth and a decrease in the global volumes of trade. Pakistan, Lebanon, Argentina and Turkey are the key examples of these emerging economies. The exporters of the products have been affected in the emerging economies adversely. The demand for exports has recorded a decreasing trend leading to an increase in the debt service costs. The economic downturn has been evident with a decline in the gross domestic product. The strengthening dollar has trapped the developing economies in the vicious cycle of poverty and debt. The risk of the rise of debt defaults is becoming imminent in the emerging economies as per the reports of the World Bank. The debt issued by the developing economies is usually in local currencies, and the borrowing of the loan is traded in dollars. The global business partners of the developing economies are burdened with dollar-denominated debt. An increase in the worth of the dollar accelerates the debt’s worth and paves the way to worsening financial conditions in the developing markets. As per the analysis of the economists, countries in the developing world are likely to undergo the consequences of the strengthening dollar for at least three to five years. The central banks of these countries are compelled to sacrifice economic growth for controlling inflation. In a nutshell, the strengthening dollar is a global macro issue. The dollar index has increased by more than ten per cent in the past two decades. It has several implications for the international markets in terms of trade, economic development, and debt repayments. People in emerging economies, in particular, have switched to the investment of their finances in non-monetary assets such as property, and land owing to the depreciation of their home country’s currency. The dollar’s appreciation is a matter of grave concern, which is required to be addressed by the global financial, and economic entities with hindsight and prudence. Its adverse implications must be duly considered to chalk out solutions to overcome. The writer can be reached at aiyza.javaid@gmail.com