BUSINESS: Dollar Hits New Low Against Euro, Trend Likely to continue, page 1

posted on Dec, 2 2004 @ 09:06 AM

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The value of the U.S. Dollar last night continue to deflate as the Euro and Pound hit record highs. The Euro reached $1.3383 breaking the high of $133.35 that was set just last week. The British Pound also made remarkable upward strides reaching it's highest value in more than 10 years at $194.38. The Japanese Yen also continued to gain value against the dollar.

ap.tbo.com
The tumble in the dollar followed a brief respite in its fall against major currencies, and investors said it was driven by the belief that U.S. and European officials would do little to stem its decline.

Japanese Finance Minister Sadakazu Tanigaki called the dollar's dip below 102 yen "rather rapid," and vaguely hinted at possible coordinated intervention among Japanese, European and American officials.

"We are always in close contact with authorities overseeing the euro and the dollar," Tanigaki said.

The decline of the U.S. currency is a global concern, since it makes exports to the United States more expensive, while reducing earnings when they are shipped back to their home countries.

A low dollar has been good for U.S. exports by making American products cheaper abroad, but makes life more expensive for Americans living overseas. The U.S. military announced this week that it would give troops posted in Europe a 31 percent increase in their cost of living adjustments to help offset their loss of spending power.

The euro has shot up from about US$1.20 in September over continued concerns about the U.S. trade and budget deficits and signals from the Bush administration that it would not step in to stem the tide.

Please visit the link provided for the complete story.

The current market trend seems as if it will continue for at least the remainder of the year unless there is intervention by the banks. Analysts feel that the Euro will top or hit $1.35 before year end. Riding the Forex wave at this time can be extremely profitable but also quite risky. So far financial news from the U.S. seems to have no affect on the rising markets.

Azeari of the Radiant Eye

posted on Dec, 2 2004 @ 09:09 AM

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Now, I want everyone to feel really sorry for me: I get paid in dollars and live in the UK.

radiant_obsidian

posted on Dec, 2 2004 @ 09:38 AM

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You have my sympathy, the pund is staying put quite well at the moment, tho I expect a global downturn in the pound soon now as well.

marg6043

posted on Dec, 2 2004 @ 10:08 AM

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Another fall for the dollar? well I though our financial gurus would do something about it the last time.

But it seems to me that nothing has been done to at least stop. I guess not body wants to do anything about the spending, No the congress or the president.

It most be nice to have a checkbook and make checks all the time but with not money to back it up.

TheBigD

posted on Dec, 2 2004 @ 01:38 PM

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Lovely, no more vacations in Europe for me. I've saved $600 so far for another trip to London, and was planning to save more. All that hard work and now I will discontinue trying to save for a trip. Yet another reason I hate politicians, and the Bush Administration. Their motto, "Oppress the laborers, impress the aristocratic."

AceOfBase

posted on Dec, 3 2004 @ 03:57 PM

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dollar decline for 2004

The dollar really took a hit this week.

EURUSD ended the week at 1.3455
GBPUSD ended the week at 1.9422

How long till it takes two dollars to buy a single British pound?

[edit on 3-12-2004 by AceOfBase]

Majic

posted on Dec, 3 2004 @ 04:28 PM

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I suspect that there is some strategery behind this trend, but I could be mistaken.

A cheap U.S. dollar has all sorts of consequences around the world. As in all such cases, there are winners and losers -- and it is not always obvious which is which.

Nations which export large quantities of goods and services to the U.S. are no doubt very concerned about the falling dollar. It impairs their ability to compete with domestic competitors.

Meanwhile, products exported from the U.S. will tend to become more of a bargain compared with offerings from competitors based in "strong currency" nations, with predictable effects on foreign markets.

It will be interesting to see where this leads. I sense the "hidden hand" at work once again.

mrdependable

posted on Dec, 3 2004 @ 04:41 PM

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Yes the jobs data out today was soooo disappointing. This US economy just cannot get going in the right direction. Well at least oil prices look set to fall yet again. Massive trade imbalance, massive budget deficit, geopolitical concerns....there is nothing at all for the dollar to hang its hat on at the moment. Pain before pleasure as they say.

Seekerof

posted on Dec, 3 2004 @ 04:51 PM

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As such, mrdependable, unemployment figures are in the double digits in Europe, productivity is still the pits, etc., etc. So in short, the gains made by the Euro are doing exactly what for the European's? As Majic indicated, there is a method behind the madness here, or else the European's wouldn't be asking the US to shore up its dollar, eh?

seekerof

[edit on 3-12-2004 by Seekerof]

MrNice

posted on Dec, 3 2004 @ 05:27 PM

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Originally posted by Seekerof
As such, mrdependable, unemployment figures are in the double digits in Europe, productivity is still the pits, etc., etc. So in short, the gains made by the Euro are doing exactly what for the European's? As Majic indicated, there is a method behind the madness here, or else the European's wouldn't be asking the US to shore up its dollar, eh?

It�s only going to get worse I�m afraid. We can�t just keep financing the rest of the world�s crapping economies. Indeed, we�ve overspent and are due for a rather nasty 10 year headache of our own. The dollar, my friends in Europe, is going to go the way of the peso.

You�re right; this has serious consequences for the E.U. The euro might collapse under the stress it is about to be put under. European economy is NOT very healthy right now and a fading U.S. market only makes things worse.

I would not want to live in South East Asia once our dollar collapses. Who will they sell their products to? If China tries to devalue the Yuen again there will be an even bigger Asian Crisis and we won�t be able to pick up the pieces this time.

Very bad times ahead folks�I�m holding to get the last of my fiat into silver before 2005 hits. If you were smart you�d be out of fiat currency as well!

sardion2000

posted on Dec, 3 2004 @ 09:39 PM

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MrNice, please do fill me in on the indications that the USD is gonna collapse anytime soon

All the metrics that are available to me points in the direction of a EU top at 1.35-1.40. The reason I gave my self a margin for error is because these things tend to overshoot the analyst esitmates by a couple of cents.

SomewhereinBetween

posted on Dec, 3 2004 @ 10:39 PM

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Originally posted by Majic
Nations which export large quantities of goods and services to the U.S. are no doubt very concerned about the falling dollar. It impairs their ability to compete with domestic competitors.

I am not understanding why you believe this is so, especially, the last statement. If you would explain, it would be greatly appreciated, and thank you.