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| World Home » Business » | Thu. Aug 28, 2008 |
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Dollar Falls to New Low Against the Euro MIL/NYT, Sep 21, 2007. New York: September 21, 2007 – There are reports all over that investors dumped dollars yesterday, sending the euro to a record high and putting the American currency at par with the Canadian dollar for the first time in more than 30 years. In practical terms, the recent drop in the dollar’s value is making Boeing jetliners and Manhattan pieds-ŕ-terre a lot cheaper for Europeans and Canadians, while Americans will have to pay more while on vacation in Paris or when buying snowmobiles made in Quebec. While the dollar has generally been drifting down against both currencies, along with the British pound, for much of this decade, its fall has gathered pace in recent weeks as traders foresee a slowing American economy while expecting more robust growth overseas. The Federal Reserve’s decision this week to cut interest rates put further pressure on the dollar by making investment returns in other countries comparatively more lucrative. As American assets become cheaper to buyers overseas, foreigners may step up their purchase of businesses and land here, creating political and cultural tensions. Yesterday, a stock exchange from Dubai, on the Persian Gulf, announced plans to take a sizable stake in Nasdaq, drawing a mixed response in Washington. nd a prominent private equity firm, the Carlyle Group, sold a minority stake to the Abu Dhabi government. The impact of the falling dollar is rippling through the world and American economies in numerous ways. It will give an edge to American manufacturers and has already helped lift exports by more than 11 percent in the first eight months of the year. Businesses with large foreign operations can expect a lift in profits when they convert their overseas earnings into dollars.
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