Monday, October 11, 2010

Currency Wars

With the announcement by the Fed that more Dollars are going to be injected into the economy, the Dollar has slid to monthly lows. The Dollar is now at a 15 - year low compared to the Yen and an eight month low against the Euro.

"With economic recovery painfully slow, recent weeks have seen nations from Japan to Colombia intervene to stop their currencies from rising to levels that would make exports prohibitively expensive, sparking talk of a currency war.

South Korea on Monday warned that failure to settle disputes about currency policy could fuel protectionism and damage the world economic recovery."

This comes at the heels of Russia mulling options to sell Euro bonds.

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2 comments:

  1. AnonymousOctober 12, 2010 at 1:15 AM

    Does the US do that on purpose, printing a lot of money to influence its interest rate?

    ReplyDelete
  2. wfthiemaOctober 12, 2010 at 8:39 PM

    This could be an indicator to how the economy really is. But more importantly, these low interests may help the United States. More and more foreigners will want to buy American products since the dollar and interests rates are so low. This will also force Americans to buy products domestically.

    ReplyDelete

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