The dollar's running weaker against other currencies. Will your business feel the pinch?
The impeachment of the president. Election controversy. Terrorism. Recession. War. Over the past five years, U.S. businesses have faced an enormous range of potential economically destabilizing factors. But through it all, they could always count on one constant: the U.S. dollar, which generally remained extremely strong compared to other world currencies.
No longer. Over the past six months, the dollar has plummeted, reaching its lowest level in four years against the euro. To some extent, the dollar's fall has been a reflection of the sluggish American economy. Yet the dollar's decline is a result not only of economic weakness, but also of the White House abandonment of the Clinton administration's strong-dollar policy. Former Clinton Treasury Secretary Robert Rubin constantly emphasized that a strong dollar was in America's interest. By noting that he supports "minimal intervention" in the price of the currency, the current treasury secretary, John Snow, has signaled that the Bush administration would not mind a weaker dollar.
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