Exchange rate question
 

Thanks to everyone who patiently answers my questions on here.

Does anybody know what the exchange rate between Euros and Amer Dollars was a year ago?

According to xe.com
January 9, 2004:
1 euro = 1.28531 US $
or $ 1 = .779022 euro

January 9, 2005:
1 euro = 1.30515 US $
or $1 = .766195 euro

That is quite interesting that the exchange rate is nearly the same after a year. I believe that it was about 1 euro= 1.24 last summer. Two years ago the rate was about even. Well it does no good to complain about the situation, does it!

If you would like to compare exchange rates from one time period to the next, see this page. Click the currency you want, then click the link for charts and graphs. You can see how the exchange has moved throughout the last year.

http://www.exchangerate.com/

You're right Beverly. I know last year planning during the winter, I was getting pretty anxious, but was glad the rate had improved by summer. I didn't look at the full range, but January 9 of last year was either the peak or very near the peak for the whole year, so this particular one year comparison isn't so great.

Hmmm...that is interesting! My hubby feels that maybe the exchange rate does not favor a trip to Europe this year - but I'm thinking it might not make much of a difference to wait a year. Thanks for the info everybody!

If you look at a 2-year chart, you will see that the rapid rise of the euro versus the dollar started in 2003.
In January 2003, a euro cost about 1.05. By 12 months later, the 1.25 mark had been reached. The record rate right now is about $1.36 per euro that was reached shortly after Christmas, 2004.

One cannot predict short term swings in currency rates much more than one can predict the stock market. If I had to make a guess, which is all it is, I think there will be no long term improvement that takes the exchange rates back to the $1.10 = €1.00 range until the US foreign accounts current balance begins to trend sharply toward zero.

What comes around, goes around as the old saying goes, but I think a weak dollar has yet to run its course. It hasn't reached the "go around" point.

My more expert friends tell me the Chinese have got to terminate their policy of pegging the yuan to the dollar before our trade imbalance makes significent reverals in the present negatively sloping curve.

At the moment, banking reform in China is macro and government directed. Oil consumption in China is second highest in the world and said to be the most inefficient of them all. (I am not sure if the Chinese consume more oil than the EU, but those figues are on a country basis and not a Euro bloc basis as best I can find.) That means high demand for fuels made from oil and poor output results. Also industries that export a lot have very favorable internal tax benefits which helps keeps prices down.

And, much of the economic expansion of China is export driven which benefitted from the beneficial rates for the yuan and high import tariff rates on consumer items. In other words; they sell to the US, but it is not a two way road.

All of these mesures keep the price of oil up and raises the price of foreign imports. None of it helps the US balance of payments.

I don't mean to sound like a pessimist, but we need an alternative energy source to mid East oil!

wliwl, if the exchange rate stops you now, it may be a GREAT many years before you go again.

Keith

Check the exchange rate Wednesday morning sometime after 8:30 when the US Balance of Trade number is released as that'll be info eagerly anticipated by the currency market.