Reining In the Runaway Dollar

Its record strength delights American tourists, but could choke the recovery

Rolf Sellge, senior vice president of Morgan Guaranty Trust Co., noticed it as a sharp rise in the din outside his office. Traders at the International Monetary Market in Chicago responded to it with arm waving and raucous bids. In financial offices around the world, tensions rose as the news flashed across video screens and was relayed in frantic telephone deals: the price of the U.S. dollar was surging to record levels. The dollar fetched 8.06 French francs at the start of the week, the highest rate in more than...

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