Withering dollar could portend good times for exporters

May 7, 2007
 Indiana exporters have more good times to look forward to if the value of the dollar continues to decline.

The dollar is at $1.368 against the Euro-a record low, according to Bloomberg.

And at least two economists-Jay Bryson of Wachovia Corp. and Kenneth Rogoff, a former International Monetary Fund chief economist-say it's likely to shrink another 10 percent.

Experts say the value of the dollar could stay weak for several years because economic growth is slowing in the United States but accelerating globally. Therefore, investors are selling dollars and directing their assets elsewhere.

The U.S. grew at an annualized rate of 1.3 percent in the first quarter and is forecast to grow 2.2 percent for the year.

Exporters fare better when the dollar is cheap because their products are priced more competitively.

Indiana exports increased 12.4 percent to a record $21.5 billion in 2005, making the state the 11th-largest exporter, according to the Indiana Business Research Center at Indiana University.

Experts accounted for about 10 percent of the gross state product in 2005, the latest year for which figures are available.
Source: XMLFULL/XMLFull1699.xml

Recent Articles by IBJ Staff

Comments powered by Disqus