Newspaper article The Evening Standard (London, England)

Weak Dollar in Shade as War Talk Grips Davos

Newspaper article The Evening Standard (London, England)

Weak Dollar in Shade as War Talk Grips Davos

Article excerpt

Byline: BILL CONDIE

THE US is tipped to abandon its longstanding strong dollar policy this week, following the failure of finance ministers and business leaders at the World Economic Forum in Davos seriously to discuss reversing the US dollar's recent slump.

The meeting of the world's economic great and good has been preoccupied with the ramifications of a possible war in the Gulf to the exclusion of nearly all else and particularly exchange rates.

With US consumer confidence and the first reading of gross domestic product for the fourth quarter likely to show the US economy slowing, there are concerns that the American policy makers, and incoming Treasury Secretary John Snow, are about to move to a "neutral" stance on the dollar and let the currency's slide go unchecked.

"I would be very worried, but people are exhausting their worry quota over Iraq," said John Llewellyn, global chief economist at Lehman Brothers in London. "What comments there have been about the currency movements have been oblique. …

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