Dollar Slumps Again

By Stewart Douglas

The dollar has hit an even greater all-time low against the Euro.  The struggling dollar is thought to have been wakened even further by growing concerns as to the state of the US economy.

The news is yet another sign of underlying problems within the US economy, which has been under performing for a sustained period of time.

With an expanding trade deficit and modest growth projections, analysts are still concerned as to the immediate future of the US economy.

The Euro rose to $1.3802 after hitting a peak of $1.3831 earlier today.  With the dollar continuing to struggle, more and more investment is moving away from the US for the time being, whilst the authorities attempt to kick start economic recovery.

The dollar has been fighting a continual struggle against most major world currencies over the course of this year, a sign that confidence in the US economy is somewhat lacking.

The news comes off the back of US Federal Reserve Chairman Ben Bernanke’s comments earlier in the week in relation to the ongoing housing sector problems within the US economy. 

His comments represent a change in tact from earlier announcements on the housing sector problems, in which he referred to the ‘controlled’ nature of the problem.

However, his announcements of today sparked more controversy in the international markets, and caused further valuation problems for the dollar against other world currencies.

Further announcements on the current situation from Chairman Bernanke have also added fuel to the flames, claiming the crisis in the sub-prime lending market (which allows those with poor credit ratings and income situations to borrow beyond their means) could cost up to $100 billion.

Meanwhile the pound weakened today after slacking retail spending, with experts citing the main causes as the wettest June on record and the recent consecutive run of interest rate rises squeezing household incomes.