The cost of financial bailouts is finally beginning to take a toll on the US Dollar, as the greenback has hit it lowest value in eight weeks. From Bloomberg:
The dollar fell to an eight-week low versus the euro on speculation a U.S. bailout for the country’s automakers will leave the government less money to protect the financial system. The greenback approached a 13-year low against the yen after U.S. President George W. Bush’s administration said it may use funds set aside for banks to prevent General Motors Corp. and Chrysler LLC from “collapsing.”Here is a Bloomberg story with details.
Not only is the timing of the Dollar's decline very poor for the U.S. economy, it is likely to halt the downward correction of commodity prices, and renew potential inflation worries.
