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Tuesday, April 26, 2011

Business News: US Dollar Hits Three-Year Low

Video Link: U.S. Dollar Reaches Three Year Low
Business News: Low US Dollar - U.S. Dollar Reaches Three-Year Low
April 25, 2011
The U.S. dollar continues to decline in value as it reaches a three week low against yen--and a three-year low against other currencies.
BY CHRISTINE SLUSSER
ANCHOR AUSTIN KIM

Multisource business news analysis from Newsy.

The U.S. dollar is hovering at a three-week low against the Japanese yen and a three-year low against other currencies. Bloomberg interviewed Citigroup’s senior currency strategist--who dishes out the deal with the dollar.

GREG ANDERSON: “The dollar weakens steadily because we have a deficit of flows coming in to this country relative to what goes out in our trade deficit and speculators try to anticipate that and they’re constantly shorting the dollar and from what we saw, they actually reduced their dollar shorts this week, which means that we’re not really in an overshoot.”

TOM KEENE: “We’re not overextended, we’re not in an overshoot.”

GREG ANDERSON: “Yup, not yet.”

...but an MSNBC interviewee wasn’t as positive, and says the likelihood of things getting worse is very real.

“The dollar is not only much weaker, but it stands a pretty decent chance of getting much weaker from where we are.”

Blogger and Urban Institute Senior Resident Fellow Howard Gleckman says the real issue is the U.S.’ nearly topped-out debt ceiling. He even says any politician opposed to raising the debt ceiling should be... impeached.

“Well it has to be raised, the deal is if we don’t raise the debt ceiling, we can’t borrow anymore money. And Congress has just passed a budget resolution for the rest of this year that requires us to borrow a trillion and a half dollars. It’s totally irresponsible for a politician who voted for that bill or a politician who opposed it because it cut spending too much to now turn around and say we’re not gonna increase the debt limit.” (Video Source: Fox Business)

...and the question on every motorist’s mind... will the low clams spike gas prices even higher? Cleveland’s CBS-affiliate WOIO interviewed Shell oil’s former president who says--yes.

John Hofmeister: “Our national deficit contributes to the weakness of the dollar, and we buy oil in dollars. And so as the dollar depresses, the number of dollars Americans pay for that crude oil goes up, because it's coming in, not from the U.S., it's coming in from foreign countries.”

Finally, a blogger for In the Money Stocks ponders when the low buck will rear its ugly head on Wall Street.

“We can only wonder when the falling dollar will become problematic for the stock market. It has already become problematic for people around the world as inflation is skyrocketing.”

Transcript by Newsy

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