There is some fresh optimism for the U.S. Dollar, and the U.S. economy in general.
This week will be crucial in determining whether the dollar has broken free from its six-year downward trend, as speculation mounts that the US is in the best position to emerge quickly from the economic downturn. The dollar index… put in its best performance for over three-and-a-half years last week and boosted the dollar to its highest level for four months. Against the euro, the dollar surged more than 5 cents, taking it more than 6 per cent higher than the low it hit last month.
…Ulrich Leuchtmann at Commerzbank said in a note he expected the dollar to rise “like a phoenix”. He said low US interest rates were not a burden on the dollar but an attraction, proof that the Federal Reserve was able to react quicker to turmoil than other central banks. He said that in a very short period, “sentiment turned by 180 degrees – the market now believes that the US economy once again will be able to leave a crisis behind very quickly”.
Nothing about the future is certain, but this is a small bit of good news for evangelists around the world who are supported in Dollars. Perhaps they will finally begin to see some stability in their income.
Still, there is a long way to go. Four years ago it cost $1.20 to get one Euro. (It cost $1.50 this morning). Two years ago, one dollar got you 2,500 Colombian pesos. (This morning the rate was 1,810.) If the Dollar actually does strengthen for a while, many preachers can regain some of what they’ve lost.
For more background see my previous post on this subject.