Word: france
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...exporting nations contend that they need a big price boost because Western inflation and the decline in the dollar have eaten away the purchasing power of the greenbacks that they receive by selling oil. In France, for example, the purchasing power of their dollars has dropped roughly 30% in the past nine months-about 10% because of French price increases, 20% because of a decline in the value of the dollar against the franc. This argument, of course, overlooks two screamingly obvious facts: a quintupling of oil prices since October 1973 has left the OPEC nations far ahead...
...American dollar has been declining irregularly on world money markets for the past five years, but never in the postwar period has its value against major European currencies sunk so low for so long. Since last September, the greenback has fallen roughly 13% against the Belgian franc, Dutch guilder and West German mark, and has lost 20% of its former worth in French and Swiss francs. Last week U.S. currency fell below the level of four francs to the dollar for the first time since 1973-and the consequences of its slump were making some disturbing waves...
...Germany last week for only 2.33 marks. The most immediate reason is that for months, American interest rates have been dropping, while in Europe rates were rising. Seeking the highest return, investors, including American-based multinational firms, have been dumping dollars and buying into currencies such as the franc. In France, the prime interest rate now is more than 12% v. as little...
Thus far, no charges have been brought against Roche. But the Adams affair is an ill-timed embarrassment for the trade-conscious Swiss, who are heavily dependent on good relations with the Common Market, where half the nation's exports are sold. The franc has been under pressure from the recent weakness of the U.S. dollar, and the Swiss are seeking closer economic ties with their neighbors - a thrust that is hardly helped by attempts to thwart the Common Market's policing authority. As one EEC official put it: "A lot of companies have their European headquarters...
...Swiss are upset because the franc's dramatic rise is increasing the cost of Swiss goods and services to outsiders and thus endangering the export and tourist industries that account for 40% of the country's gross national product. In part the upward march of the franc-and other currencies-against the dollar reflects a continuing uneasiness about the strength of the U.S. economy that backs it. The main cause of the franc's extraordinary rise, however, seems to have been some heavy purchases of Swiss francs in the past few months by Middle East governments trying...