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Euro at an all time high against the Dollar

Dollar vs Euro

Dollar vs Euro

This past week saw the Dollar falling to an all time low against the Euro amidst pressures and reluctance of foreign investors to invest in America due to the ongoing trade deficit and global volatility in the markets. Amidst all these developments, the Dollar slipped as low as 1.59, which means that one Euro brought 1.59 Dollars.

The fall of the Dollar started in the mid-week when data from the international markets started showing a decrease in the amount of foreign currencies flowing into the US. This led the investors into speculation and most of them started to either withdraw their money from the US markets, or stopped investing further, which led to the fall of the Dollar, not only against the Euro, but against the Yen and even the Rupee.

The main reason behind the rise of the Euro has been the fact that the US is enforcing stringent tax laws against Chinese products flowing into the US, especially the textiles and the steel products. In reactionary actions, the Chinese government had in turn stopped investing into the US markets, and rather they have started to foray into the European and Japanese markets, making the Dollar weaker and the Euro and the Pound stronger on the International front. Looking at the Chinese reactions, small and medium sized investors have also started investing in the Euro, which is considered to be the apt Universal currency against the Dollar, which is the universal currency presently.

Terrorism is also a reason behind the decline of the Dollar. It is not that European nations are secure against it, but the investors feel that the Euro covers a larger geographic area than the Dollar and therefore, an attack in one of the countries where the Euro is existent will not hamper the overall worth of the European markets, and therefore, hypothetically at least, the Euro is more cascaded against the ill-effects of terrorism as a currency.

Over the next few weeks, it is speculated that the Dollar will recover, but the Euro will hold a commanding position over the long run considering the American Fed’s policies, effects of terrorism and the genuine charm of investing in a universal currency such as the Euro.

7 Comments so far

  1. Annette   December 7, 2008 8:18 am

    The dollar will continue falling and the european currency will increase its value. Better said, I believe that the economical crisis will increase the euro value and decrease the dollar. That’s because US is the worst affected region. However, the high euro currency is not a good thing.

  2. Penter   December 9, 2008 7:51 am

    Lots of people support the euro currency. Some even say that this is because many people hate the US. This may be a good thing for the european currency in the euro vs dollar fight.

  3. Cora   December 9, 2008 11:59 am

    The funny thing is that until 2002, the euro currency was only used as an electronic currency. And now it is getting stronger and stronger.
    I think the european currency will simply go by the dollar.

  4. Parker   December 10, 2008 7:36 am

    Yes, withdrawing money from the US markets is the most important reason why the euro currency has won this battle until now. The euro market is growing and has a good position. But I don’t think the REAL terrorism is a solid reason why the dollar is falling.

  5. Petre   January 17, 2009 6:01 am

    And now we’re talking about recession. We will see the european currency growing in the euro vs dollar fight. At least this is what I think.

  6. Jack   May 5, 2010 5:14 am

    biggest money in the world you can count

    Pound Sterling

    Euro (EUR)

    United States Dollar

    Switerland

    Canadian

    Japanese Yen

    Singapore dollar

    Chinese china (RMB)

  7. Jack   May 5, 2010 5:19 am

    lol 1 euro = malaysia 5 ringgit!

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