Dollar Declines Against Euro as Crude Oil Prices Increase

It doesn’t get much clearer than this. As the last paragraph in this post says, nearly every time the dollar drops against the euro, oil goes up (gas prices go up). And this has happened repeatedly over the last year especially. How much more plain can it be? We can’t blame the speculators, the oil companies, or Middle Eastern oil barrons anymore. Our economy is dying with the dollar. Shouldn’t we be applying some real solutions to this problem? Note: Obama and McCain both know nothing about the economy so with either of them it will continue to be business as usual — but its likely that our economy soon won’t be.

By Ye Xie and Candice Zachariahs, July 1 (Bloomberg) — The dollar dropped to near a three- week low against the euro as crude oil prices rose, adding to concern higher energy prices will weigh on the economy.

The Australian dollar weakened as the central bank said the highest borrowing costs in 12 years and record gasoline prices will force households to cut spending. Turkey’s lira was the worst performer against the dollar among the world’s currencies after police arrested more than 20 persons with suspected links to a group allegedly plotting a coup.

“Oil prices are higher,” said Tim O’Sullivan, chief foreign-exchange trader at Forex.com, a unit of online currency trading company Gain Capital in Bedminster, New Jersey. “The dollar is vulnerable.”

…The euro-dollar exchange rate and oil have moved in the same direction 90 percent of the time during the past year, according to Bloomberg calculations based on the correlation of their value changes. Yesterday, oil touched a record $143.67.

Report: OPEC president sees oil at $170 this year Marketwarch.com, 6.28.08
Khelil blames Fed, falling dollar, increased demand for surging crude prices