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Politics : PRESIDENT GEORGE W. BUSH -- Ignore unavailable to you. Want to Upgrade?

To: Kenneth E. Phillipps who wrote (700437)	9/7/2005 1:38:34 PM
From: DizzyG	Respond to of 769670

U.S. Dollar Gains on Euro Associated Press BERLIN (AP) - The U.S. dollar rose against the euro and other major currencies Wednesday as the U.S. Congressional Budget Office reported Hurricane Katrina's impact would damage the country's economy but not be "overwhelming." The gains also came as a German think-tank lowered its 2006 growth estimate for Germany, Europe's largest economy, to 1.1 percent from 1.3 percent on concerns over high oil prices. The 12-nation euro bought $1.2437 in early European trading, down from $1.2453 late Tuesday in New York. The British pound was at $1.8401, down from $1.8421 late Tuesday. The dollar rose to 109.95 Japanese yen from 109.65 yen. The dollar slid last week on concern that the hurricane, which devastated a swath of the U.S. Gulf Coast, may damp economic growth. The effects may prompt the U.S. Federal Reserve to halt a series of interest rate increases, diminishing the appeal of dollar-denominated investments. Still, the U.S. currency has recovered along with yields on Treasury bonds -- an indicator of interest-rate expectations -- and after crude oil futures eased back from record highs last week. Benchmark light, sweet crude for October delivery fell 35 cents to $65.61 a barrel on the New York Mercantile Exchange, more than $5 off its intraday high of $70.85 reached Aug. 30 in the wake of Katrina. It still remains around 50 percent higher from a year ago. In Washington, the Congressional Budget Office reported the hurricane will cost 400,000 jobs in coming months and could trim economic growth as much as a full percentage point for the second half of the year. It said Katrina's overall impact was likely to be "significant but not overwhelming" to the overall U.S. economy, especially if energy production along the Gulf Coast returns to pre-hurricane levels quickly. Separately, the U.S. Labor Department reported that growth in Americans' productivity slowed in the spring while labor costs edged up, developments that raise concerns about inflation pressures. According to the report, productivity -- the amount of output per hour of work -- increased at a 1.8 percent annual rate in the April-June quarter, down from a 3.2 percent increase in the first three months of the year and the slowest increase since the summer of 2004. Labor costs, meanwhile, rose at a 2.5 percent rate in the spring, slightly higher than the 2.2 percent rate of increase in the first three months of the year. In Europe, the German IfW think tank said the country's economy is experiencing a slack period and high oil prices have depressed the outlook. The institute, one of Germany's top six economic research think-tanks, said it still expected strong exports, but predicted weak domestic demand. © 2005 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed. news.moneycentral.msn.com