Re: Boycott Brand America

 Tue, Nov. 18, 2003

Dollar Falls to All-Time Low Against Euro
Associated Press

NEW YORK - The dollar fell to an all-time low against the euro Tuesday
in a broad-based selloff of the U.S. currency. 

Traders said the reasons behind the euro's surge of nearly 2 cents on
the day ranged from concerns about trade and geopolitics to investment
outflows.

"It's difficult to put a finger on the precise news behind" the sharp
move lower in the dollar, said Kenneth Agostino, senior dealer at Gain
Capital in New Jersey. "There's an overall nervousness about holding
U.S. assets."

After a lazy, rangebound session overnight, the selling began in
earnest following news that the Bush administration has granted U.S.
industry requests to impose temporary quotas on some imports of
Chinese textiles.

That fed into growing concerns that the U.S. is edging closer to
low-intensity trade wars with its major trading partners, over not
just textiles but also steel tariffs and currency manipulation.
"In general, intervention in trade flows is a backdoor devaluation,"
said Ram Bhagavatula, chief economist for North America at Royal Bank
of Scotland in New York. "It's an implicit admission that the currency
should be weaker."

Perhaps more importantly, the Treasury Department released data
showing a big pullback in foreign investment in Treasurys, agency debt
and equities in September. The slowdown in net inflows to $4.2 billion
[down from $49.9 billion in August TB]  has major implications for the
dollar, because it comes at a time when the ballooning U.S. trade
deficit requires an increasing amount of financing from abroad to keep
the dollar from falling.