The Free Fall Of The Greenback
November 23, 2009 9:45 AM
The US dollar has seen a free fall in recent times as it hit a 15-month low against other currencies. The worst may be over, but there has been widespread criticism of the Obama administration saying that the current fiscal policy is detrimental to the US economy.
Fed Reserve Chairman Ben Bernanke commented that the Fed does watch the dollar’s value. It is alarming that the dollar fell to a 15-month low this week and is 15 percent lower as compared to its value in March. There is a trend in some quarters to sell dollars to buy commodities and higher yielding currencies, because huge amounts of liquidity have attracted investors into riskier assets.
Incidentally, the dollar hit a 14-month low against the Euro at 1.5064 on electronic trading platform EBS in late October. Bernanke, meanwhile has said that the US Fed is monitoring currency markets closely as it is aware of the implications of a falling dollar.
