Can the Dollar Fall Again?

Abstract

The current value of the dollar rests on a precarious equilibrium. Over the remainder of 2007, several factors could shift market expectations and push the value of the dollar below current levels. On the domestic front there are inflationary pressures: all indications are that surprises may emerge on this side, especially given the dynamism of private aggregate demand, which partly underlies the economy's strong performance during the first quarter of 2007. Continue reading...