Wednesday 30 May 2007

I was strong, but now ....

The current position of the dollar in relation to the Euro seems to be as a result of a lack of growth in US productivity. As a result the US government is having difficulties financing its trade gap.

The dollar has continued to fall and is now at a record low against the euro, and has also weakened against many other currencies. As the U.S. economic slows, those in Asia and Europe continue to race ahead.

This is underpinned by a slowing of U.S. productivity growth for three years straight' this may even signal a permanent downshift.

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