Reuters
Bush: Dollar's Fall Contrary to Policy [Dollar going lower]
Saturday May 31, 5:41 pm ET
By Steve Holland
KRAKOW, Poland (Reuters) - President Bush said the "devalued" level of the dollar on global markets runs contrary to U.S. policy in favor of a strong dollar, according to an interview transcript released on Saturday.
Bush was interviewed by Russia's RTR TV on Thursday. The transcript was released by the White House on Saturday as Bush headed to St. Petersburg.
Asked about U.S. dollar policy, Bush replied: "The policy of my administration is for there to be a strong U.S. dollar."
When the reporter told Bush the dollar was not strong at the moment, Bush replied:
"Well, I understand that. And the marketplace is making decisions as to whether the dollar should be strong or not. Our policy is a strong dollar. And we believe that good fiscal and monetary policy will cause our economy to grow and that the marketplace will see a growing economy and therefore strengthen the dollar," he said.
"But you're right, the market, at this point in time, has devalued the dollar, which is contrary to our policy," he said.
Bush's remarks were released on the eve of a Group of Eight summit in the French town of Evian, where any coordinated statement on volatile currencies could be treated as a sign that the dollar's sharp decline has gone too far, analysts say.
Bush, as well as leaders of Japan and Germany, had already taken the unusual step of talking about currencies in advance of the G8 summit, spurring talk currencies may be on the agenda despite policymakers' recent efforts to downplay the issue.
European and Japanese exporters have grown uneasy with the steep fall in the dollar this year, yet the dollar's decline has accelerated as currency markets perceived a lack of concern among policymakers from the world's richest nations. Those concerns peaked two weeks ago when U.S. Treasury Secretary John Snow appeared to adopt a hands-off approach toward the dollar's decline even while voicing Washington's long-standing commitment to a strong U.S. currency.
Snow said the dollar's 15 percent decline this year was a "really fairly modest" realignment of currencies, remarks which were widely read as a signal to keep offloading the greenback. |
