Dollar Loses Ground to Euro and Pound As Tourist Season Approaches
NEW YORK (AP) -- The dollar hovered near a record low Monday against the euro after the 13-nation currency climbed to within 1 cent of its all-time high, while the pound backed down from a 14-year record.
Currency traders now turn their eyes in the coming days to economic data that could further the pound's rally. Key inflation figures from the U.S. and Britain due out Tuesday will be followed Wednesday by the minutes from the Bank of England's last meeting on interest rates.
The data could increase the risk of a British rate hike while worries about sluggish economic growth in the U.S. persist.
Higher interest rates, used to combat inflation, can bolster a currency by making certain types of investments more attractive.
Movement against the dollar could drive up the price of exports and tighten the pinch for travelers to Europe just as the tourist season approaches.
Supported by crackling economic growth, falling jobless figures and interest rates much lower than those in Britain and the United States, the euro bought $1.3549 in late New York trading after climbing to $1.3576 -- its highest point since January 2005 and near its December 2004 record of $1.3667.
It traded at $1.3539 late Friday...
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British Pound Breaks Through $2 for 1st Time in Nearly 15 Years on Surge in Inflation
LONDON (AP) -- The British pound broke through the $2 mark on Tuesday for the first time in nearly 15 years after new data showed an unexpected surge in inflation, prompting speculation of interest rate increases.
Because of the pound's appreciation over the past few months, a Big Mac sandwich at a McDonald's restaurant in London now costs the equivalent of about $4, and a pint of beer at a local pub costs more than $5.
The pound was at its highest level since "Black Wednesday" in September 1992, when Britain crashed out of the European Exchange Rate Mechanism.
After initially retreating back below the psychological $2 mark, the currency spiked again to $2.0071 as the dollar retreated following the release of U.S. inflation data showing the core prices rose less than expected last month.
In afternoon European trading, the pound was at $2.0064 -- up from $1.9900 late Monday in New York.
"We believe that sterling could well remain above $2 for an extended period," said Howard Archer, chief economist at Global Insight...
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THE CATHOLIC KNIGHT: In my recent post "War of the Worlds" I pointed out how God uses the Biblical example of chastising civilizations through wars and civil unrest. Based on this assumption, it is clear our Lord is doing just that with western civilization, and the United States in particular. The tragic events of 9/11/2001, followed by America's subsequent wars in the middle east, have left the United States shellshocked, with voters ushering into power the peacenik appeasers of the Democratic Party in 2006, effectively neutering and already emasculated Republican president after years of military blunders and internal scandal. For those who believe God deals with nations according to their deeds, America is getting the government she deserves, as is the case with all democratically controlled countries. America's political and military primacy is threatened, and in danger of serious compromise.
Now we see the early stages of economic collapse. The value of the dollar has been decreasing for decades, however, this devaluation has usually coincided with the deflation of other world currencies along side it. Not so anymore; the American dollar is spiraling downward against European currencies, while the EU gradually takes its place as the world's emerging economic leader. It many not be long now before the US dollar slides in relation to other world currencies as well. Slowly and gradually, our money is becoming worthless.