Laying off Tokyo and Beijing until after the election.

Position:Off The News - Brief Article

Many global market participants have been a bit mystified over the Bush Administration's approach to the dollar. After the publication of the G7 Dubai statement last year (which called for among other things greater exchange rate flexibility and which led to significant dollar weakening against the euro), the assumption was that Washington had bad enough of countries artificially manipulating their currencies against the dollar regardless of the fundamentals.

Yet since the Dubai statement, Washington has become curiously silent over all matters relating to exchange rates. For example, at the follow-up G7 meeting in Boca Raton, European officials had expected Washington to press forward, arguing specifically that China and Japan are the main culprits keeping their currencies artificially weak through massive currency intervention. But the United States was largely...

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