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The dollar hit a new low against the seemingly unstoppable euro Friday as the 13-nation currency broke through $1.41.
. . .
The U.S. dollar fell further against the Canadian dollar after reaching parity for the first time since 1976 on Thursday. One Canadian dollar bought $1.0068 in U.S. currency at its highest point Friday before edging down to $1.0022 in afternoon New York trading.
The Canadian dollar has experienced a summer of record highs on soaring crude prices and a strong economy.
In other trading, the dollar slid to $2.0192 against the British pound from $2.0099 late Thursday. It rose slightly against the Japanese currency to 115.34 yen from 114.44 yen.
3 comments:
I wonder if this will give American car companies a chance to compete in the luxury market again. The various European car companies can't be happy about what is happening to the dollar.
The one upside to all of this is that this is the surest way to fix our trade imbalance.
Leroy,
Yes, Europeans are concerned about exports.
"In Europe, there was at least one call for a Continentwide effort to reverse the course of the euro, which is used as the official currency in 13 countries. “Let’s say that it’s a change in level that concerns all of us Europeans, and it’s clearly a point we must address together among Europeans,” the French finance minister, Christine Lagarde, said during a trip to China, according to Reuters.
Evidence is starting to emerge that the euro’s strength is chipping away at sales. Ralf Wiechers, chief economist for VDMA, an association of German machine-tool makers whose performance has been the backbone of the country’s boom, said that the currency values are starting to hurt earnings despite continued gains in sales."
If the Europeans decide to race us to the bottom it will be a disaster. Massive inflation would almost certainly occur in that scenario.
Of course... their alternative is watching their exports and tourist trade dry up.
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