Fuel oil prices have consistently, markedly shown an incredible rate of increase. This is expected to further surge upwards due to the forecast of the rise in value of the US Dollar in the world market this month of October.
For both import and export oriented sectors, this is both good and not good. Importers outside of the US will find it difficult to pool dollars to pay for their orders. Exporters out of US will be happy since each dollar will fetch more of their native currency than before. However, if they are heavy users of non-locally available raw materials, they will suffer the same fate of import companies.
The business sector and banks are now preparing to cushion the impact of the portent of a strong US currency vis-a-vis the rest of the world. Public sector is also admonished to put in place stronger monitoring systems: If prices of fuel oil is hiked to unreasonable levels, this could lead to the hike in the price of the factors of production. Prices of imports such as starch, flour, soya, equipment, among others, will cause inflation in the economy.
The multiplier effect translates into hardship on the part of the people and given the current uproar over corruption within the government together with profit and non-profit companies, we can already foretell what will happen if the people's sad plight cannot be assuaged by sheer political promises and very patronizing, empty motherhood statements.
On guard! It is best not to be caught unprepared.
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