Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: Zardoz who wrote (29378)	3/4/1999 5:14:00 PM
From: John Hunt	Respond to of 116903

Re Option Answer Hi Hutch, Thanks, I will study it as soon as I recover from the 24" of snow here. Appreciate it. John

To: Zardoz who wrote (29378)	3/4/1999 7:32:00 PM
From: goldsnow	Respond to of 116903

Euro sinks to record low ECB President Wim Duisenberg is worried about exchange rates The euro has sunk to a record low against the dollar, leaving it more than 6% below the value at which it was launched. A euro is now worth $1.08, but those charged with looking after the new currency's fortunes say it is more a matter of dollar strength than euro weakness. The European Central Bank (ECB) decision to leave interest rates unchanged at 3% did little to improve the euro's exchange value. A rate cut would have only served to weaken the currency further. It was only the ECB's second meeting since the launch of Europe's single currency. A lack of apparent inflationary pressure did not persuade bank chiefs to cut rates, despite intense pressure from German finance minister Oskar Lafontaine. Concern about the condition of the German economy may be one of the factors undermining the euro's value. Its unemployment is relatively high and there have been worrying signs about rapidly slowing economic growth. Inflation subdued One of the main arguments in favour of a rate cut is the continuing fall in eurozone inflation which was only 0.8% in January, compared with 1.1% a year earlier. It was unchanged from a month earlier. The rate is strongly influenced by the situation in Germany, whose economy accounts for a third of the region. Inflation there was just 0.2%. In calling for a rate cut, Germany's finance minister Oskar Lafontaine said: "Inflation in Europe is at an all-time low and producer prices are falling by around 2%, with this situation long-term rates are around 3.5%, higher than gross domestic product growth." However, those against a rate cut cite fears of possible inflationary pressure from the 4.2% wage settlement reached last month in Germany's engineering industry. Euro weakness The dollar's strength has continued to put pressure on the euro. This boosts the prospects for European exporters, although the prospects for growth this year in the eurozone are projected to be less than 2%. A cut in European rates at the moment could only worsen the euro's decline - especially if US interest rates look like they will rise. ECB President Wim Duisenberg blamed the strength of the US economy for the currency's decline, saying the euro's fall represented dollar strength rather than euro weakness. However, he also blamed European politicians who have tried to exert political pressure on the ECB's monetary policy. Some central bankers oppose a rate cut for political reasons, not wanting to be seen to be compromising the bank's independence by giving in to pressure. Rates held in January The ECB's governing council decided to keep interest rates on hold at their first post-launch meeting last month. The decision was widely expected. Mr Duisenberg said the outlook for inflation was "favourable," but that developments in credit markets needed to be closely watched. Interest rates were at historically low levels, but exchange rates needed close monitoring, he said. Annual growth of the M3 measure of money supply rose in the three months to January to 4.9%, up from 4.7% in December and above the ECB's target of 4.5%. Both M3, which reflects how much individuals are borrowing, and the exchange rate are seen as indicating the outlook for inflation. Higher prices for imported goods because of a weak euro could eventually see inflation rise. news.bbc.co.uk