What is Happening to the U.S. Dollar?
Last year the dollar depreciated by about
18 percent in value relative to the Swiss franc
and Japanese yen, about 11 percent relative to
the German mark, and about 10 percent
relative to the British pound. It gained against
some others, as for example, the Canadian
dollar. Using an aggregate measure of the
change in the exchange value of the dollar
that takes into consideration the movement
in the exchange rate in terms of currencies of
our 15 major trading partners weighted by
their relative importance, we find the dollar
has depreciated by about 41/2 percent over the
past year.