Dollar up against major currencies: Silver Lining? Or double edged sword?
October 23, 2008 by SwizStick
Filed under Education, Misc Logistics, QuickNews
Via CNNMoney.com:
Compared with other currencies around the globe, the greenback was perceived as a safer haven amid a growing feeling that the U.S. government’s bailout efforts will lead to a faster rebound in the U.S. versus other countries.
The euro cost $1.2832, down from $1.3062. The euro hasn’t traded this low since January 2007.
On Wednesday, British Prime Minister Gordon Brown echoed comments made a day earlier by Bank of England Governor Mervyn King that the United Kingdom, along with other countries, is pushing toward a recession. King on Tuesday also hinted that a U.K. rate cut may be on the horizon.
The dollar rallied against the British pound Wednesday. The pound cost $1.6254, down from $1.67055 late Tuesday.
The dollar is also sharply up against the Canadian Dollar, Mexican Peso, and, to a slightly lesser extent, the Thai Baht, all major trading partners. The good news is that a stronger USD means cheaper imported goods, but it also puts U.S. exports at risk as it becomes more expensive for trade partners to purchase U.S. goods.
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