Does Apple pay its contract manufacturers in China in US dollars or in Chinese currency?
What does that have to do with my reply? The commenter I replied to blamed Tim Cook for increased prices in
Europe. Inflation over the past year in the EU is almost 11%. The U.S. dollar is up about 16% versus the Euro over the past year.
In any case if we want to talk about China, the U.S. dollar is up against the Yuan by over 14% in the past year. Inflation and currency exchanges influence all aspects of a business. A stronger dollar can go further in overseas purchases but it also means Apple's profits outside the U.S. are worth less. This means that Apple might be able to get more in other countries for the dollar because Apple can buy more other currency with less U.S. dollars (we are holding inflation constant in this situation, which isn't true in real life). However, as already mentioned, it also means that sales outside the U.S. bring in less revenue in U.S. dollars. As a U.S.-based company, Apple measures incomes and profits in U.S. dollars so a strong dollar is usually a problem with a lot of international business. The larger problem are rapidly changing currency exchanges. A strong U.S. dollar is fine as long as it's relatively stable compared to other currencies.
Back to the main topic now. Apple has been eating some inflation over the years though. An example I've given before is this: the iPhone X released at $1000 in the U.S in 2017. The 14 Pro was also $1000 in 2022. Inflation in the U.S. is up about 21% in that time. This means there was an effective price cut of 21% over the past 5 years for the flagship phone. The Pro Max is $1100. That’s still less than the inflation adjusted X price.
What about Germany, which is part of the EU and thus more directly relevant to my reply to the other commenter? The iPhone X released at 1149 Euro in 2017. Factoring in inflation, 1149 Euro in 2017 is
1312 in 2022 in Germany. The iPhone 14 Pro costs
1299 Euro in Germany. That means the newest comparable flagship phone price matches inflation over that time (in fact is slightly cheaper). This doesn't even factor in currency exchange differences, which make the conversion back to U.S. dollars worse right now. This means Apple is in fact, still eating some of the inflation and currency exchange factors instead of passing that on to consumers.