Exchange rate

[Mayor]

Currently $ 1.89 = 1 pound
$1.26 = 1 Euro

Is this the high or is this trend expected to continue?
Anyone know what's going on?

[Brandon]

I don't have a friggin clue. All I know is that I'm not buying jack for a while.

[Bruce5]

This is very high. Less than 2 years ago I was in Italy and only $0.85 American would buy 1.00 Euro. I spent like crazy.

[robmcd]

repeat after me: DEFICIT ... trade DEFECIT ... budget DEFICIT ... low interest rates... DEFICIT ... DEFICIT ... DEFICIT

[JDC20]

Dave sait it all but he forgot to mention the..... DEFICIT.

[Enyafan]

Originally posted by Brandon
I don't have a friggin clue. All I know is that I'm not buying jack for a while.

Amen Bran. we have talked about this in chat recently. i may order from hk for abit, but as long as the dollar is makin' me holla, forget it. i don't need any cigars that badly.

[MoTheMan]

Factors that weaken a currency:

1) Government deficit (Self Explanatory).
2) Trade deficit (Self Explanatory).
3) High Inflation (we're safe here).
4) Low interest rate (urrency flight).
5) Low real economic growth (uh, in this department we're experiencing growth but a good chunk of it is from "eficiency growth, not real growth).
6) Volatility (the greater the currency volatility, the higher the price for a currency contract on the commodity & currency exchanges).

What that says is that the mighty dollar doesn't look so mighty (in the eyes of outsiders -- i.e. read less demand for the dollar so the price of the dollar in other currencies becomes very cheap OR we pay more to buy stuff in other currencies).

According to the (not so happy news), no real action is currently being taken to change the trends that have weakened the dollar.


MoTheMan

[IHT]

i remember when the Euro first started, it was 1 = 1.

the past 2 trips to germany, i've been watching it closely. the first trip in Dec, it was $1 = .81 Euro.

this last trip, it started off as $1 = .76 Euro, but then had risen up to .80 Euro by the time we left.

i'm heading back this coming wednesday...

this is what i use - updated daily (hourly)

it's now .78 Euro.

[MoTheMan]

These are all time lows!!

I'm so bummed.

MoTheMan

[IHT]

to me, a newbie to great havanas, that's GOOD news. so, when they get back to normal, which they will, i'll feel even better about paying good money for the best cigars on the planet.

[MoTheMan]

YEAH!!

I just hope that the dollar doesn't keep going South a while longer. That would be such a bummer.

[robmcd]

Dollar's fall unsettles G7 talks

The weak dollar is likely to be the key issue on the minds of the G7 club of wealthy nations' finance ministers when they meet this weekend.
G7 finance ministers and central bankers start their two-day meeting in Boca Raton, Florida, on Friday.

Japan's finance minister has said he will be pressing for more stability in exchange rates movements.

But economists think US trading partners may back off from changing the G7's official stance on exchange rates.

The dollar has tumbled since the last G7 meeting in Dubai in September, putting pressure on European and Japanese exporters and prompting calls for greater exchange rate stability from their governments.

Anger over dollar

The G7 is shaping up for a spat over exchange rates, though economists suspect the row may turn out to be more muted than seemed likely a few weeks ago when the dollar seemed to be in free-fall.


European finance ministers voiced fears last month that the dollar's decline could hamper economic recovery in the eurozone.

The dollar has dropped 9% against the euro, and 7% against the yen since the G7's last get-together in Dubai in September 2003.

As 2004 dawned, the dollar hit a rapid succession of all-time lows against the euro and an 11- year low against sterling, though its falls eased up slightly as January wore on.

The Japanese government stepped in to stem the yen's rise and protect exporters by selling 7 trillion yen from its reserves in January, Finance Ministry data showed.

Earlier policy backfires

All eyes will be on the G7's official communique on Saturday to judge how aggressively the US' partners in the G7 have pursued their complaints.


Economists and currency traders will want to see if the communique ditches a call for greater exchange rate flexibility inserted at US insistence at the Dubai summit.

At that time, the G7 nations lined up behind a US crusade to curb cheap Chinese exports by demanding China revalue its currency, hence the call for exchange rate flexibility,

European G7 nations also endorsed US demands for Japan to let the yen rise, but were unprepared for the euro to leap upwards.

All bark and no bite?

US Treasury Secretary John Snow has made clear he wants to avoid a battle over exchange rates, telling US lawmakers: "The subject of the dollar versus other currencies is one I stay away from because it can cause mischief."

Most economists think he will get his way. "I'd be deeply surprised if 'more flexibility' is removed," said Robert Rennie, of Westpac Banking Corp in Sydney.

Given that the dollar's fall is rooted in record US trade and budget deficits which will not quickly go away, US trading partners risk embarrassment if they insist too loudly on a policy of reversing the dollar's decline and then fail.


Story from BBC NEWS:
http://news.bbc.co.uk/go/pr/fr/-/2/h...ss/3465707.stm

Published: 2004/02/06 16:330 GMT

© BBC MMIV

[ESP]

Currently $ 1.89 = 1 pound
$1.26 = 1 Euro

i've heard a prediction that this trend will continue and peak at 1.35 $/euro. the main reason being that many of the major banks are dumping their dollars and buying euro - despite the bs they state at the public meetings - it seems the reason behind this is prediction of an expanding euro-zone economy rival to that of the US,, on the up turn, the dollar usually gets stronger during election years - now I'm talking from both sides of my mouth! (and I'm not even a politician!)