Geithner vows to defend strong US dollar policy

Editor's Note:  Today in opposite world....

© AFP/Getty Images/File Brendan Smialowski

AFP

NEW YORK (AFP) - US Treasury Secretary Timothy Geithner vowed Tuesday that the United States would never follow a strategy to weaken the US dollar.

"Our policy has been and will always be, as long as I will be in office, that a strong dollar is in the interest of the country," Geithner said at a New York conference organized by the Council of Foreign Relations.

"We will never embrace a strategy to weaken the dollar."

It was the first time this year that Geithner had publicly proclaimed a US strong-dollar policy, a mantra of treasury secretaries for more than a decade.

In the year to date, the dollar has lost 6.5 percent of its value compared with a basket of currencies held by its major trade partners.

© AFP -- Published at Activist Post with license

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Dollar set for sharp decline, Goldman forecasts

The dollar will embark on a sharp decline over the next 12 months, Goldman Sachs forecast on Wednesday, as policy makers in Washington look poised to press the trigger on another round of printing money.

Richard Blackden
Telegraph

The investment bank expects the dollar to drop to $1.79 against the pound in six months and $1.85 in 12 months. Sterling closed at $1.5891 in London yesterday. The euro won’t be spared either, with the dollar’s slump forcing it to $1.50 six months from now and $1.55 in a year’s time.

Powered by President Obama’s stimulus package and a rebound in inventories, the US recovery peaked in the final three months of last year and has been slowing ever since.

As the summer delivered a diet of weak economic data, the conviction has strengthened among a growing number of officials at the Federal Reserve that it should risk another bout of quantitative easing - printing money to inject into the economy.

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