Commentary: Tame The Currency Markets? Think AgainDavid Fairlamb
The euro is plunging. The yen is soaring. The dollar hovers in between. This volatility can certainly seem unnerving. As the euro weakens, the prices of imports into Europe increase, and inflationary pressures grow. A strong yen could abort Japan's nascent economic recovery. The dollar's appreciation against the euro makes life difficult for U.S. exporters. If the euro were now suddenly to appreciate against the dollar--a distinct possibility given that the euro zone economy is on the rebound--financing Uncle Sam's burgeoning trade deficit could be a real problem. No wonder some economists and politicians say central bankers should make exchange-rate stability their first priority.
To continue reading this article you must be a Bloomberg Professional Service Subscriber.
If you believe that you may have received this message in error please let us know.