USB Flash Drives Trends - Pound begins to strengthen against the USD
Like many products in the world today USB flash drives are manufactured in China and trade with the factories that produce them is all undertaken in US Dollars ($). So, when the British Pound (£) strengthens against the USD ($) the net effect is a reduction in the factory price of USB flash drives that are imported into the UK.
In May 2010 the US Dollar stood at $1.43 against the GBP (£) but since then the GBP has gradually strengthen to the point where it now stands at $1.62 – this 13% rise in the strength of the British Pound equates to a direct 13% fall in the cost of USB flash drives imported into the UK.
Worries of inflation getting out of control, not helped by recent VAT increases and a rise in commodities, mean we’re
likely to see Base Rates in the UK increase sooner rather than later. The release today of the minutes of February's Monetary Policy Committee (MPC) meeting shows growing support for an early rate increase and this sentiment has driven further strengthening of the Pound.
Of course currency exchange rates are not the only factors that determine the price of USB flash drives but they are a pretty critical one and it is one of the key reasons why many suppliers of flash drives will only hold quotes for around 3 days!
Other factors that have a bearing on the price of USB flash drives are classic supply and demand trends, for example prices always spike upwards when some of the global brands place large pre-Christmas orders on the flash memory factories. Bizarrely short terms shortages caused by local power outages (yes, they still happen in China) can also feed through to the price of USB flash drives.
Fundamentally “flash” is a commodity and traded on the markets just like coffee, gold and cereals. As such the price a customer pays can vary dramatically within is short space of time and with so many factors driving the price its difficult to judge which way prices will move.
The only sure thing is that over time prices for a given memory size will fall. They always have and always will. The challenge is predicting what happens in the next few weeks and months!