As of the early hours of November 10, 2005, the euro fell a quarter percent, currently holding at 1.1750 dollars (Waki, 2005). This is another drop in a series of recent falls; for example, it traded at $1.793 on November 7, 2005 and at $1.787 on November 8, 2005 (Read, 2005). This is an interesting situation as the euro had previously and steadily been appreciating. Naturally, a falling euro signals a stronger US dollar. In fact, on November 8, 2005, 'the dollar rose to its highest level against the euro in nearly two years' (Read, 2005, 1). Some speculate that it may continue to rise depending on political, social, and monetary situations in euro-zone countries.

The value of a nation's currency is grea

In conclusion, there are several factors that contribute to the appreciation or depreciation of a nation's currency. Political, social, and economic conditions hold great sway over which way a currency will go, whether it will appreciate, depreciate, or remain the same. Equally important are the expectations (either positive or negative) many hold about the future conditions of a country. Current events in Europe and the United States nicely illustrate these economic principles.

tly determined by its political stability and policies. In the presence of political uncertainty, a country's currency is likely to depreciate. This phenomenon reflects common sense: one is naturally hesitant to invest in or conduct business with a nation whose political future is unknown. Simply put, in such situations the risks are too great and the vulnerabilities too numerous for an astute investor or businessman. One must not look too far for a current illustration of this principle. In fact, Germany's political uncertainty is one reason for the recent depreciation of the euro. The recent German elections spurred controversy and upheaval when then Chancellor Schroder 'refused defeat' (The Economist, 2005, 53). Merkel, promising to create a 'grand coalition', is finding the feat ever more challenging as some of her colleagues have resigned while several leaks have provoked more controversy. With setbacks occurring frequently, which are stalling the nation's political machine, it is not surprising the euro is falling.

In addition to p

Some common words found in the essay are:
Moscow Times, Alex Weber, Chancellor Schroder, Federal Reserve, Germany Brussels, Act' Waki, , Europe United, Bank ECB, waki 2005, Low DollarWaki, nation's currency, 2005 1, value nation's, current events, read 2005, waki 2005 1, value nation's currency, exchange rates, investment business, events europe united, investors businessmen, europe united, november 8 2005, current events europe,
Approximate Word count = 1036
Approximate Pages = 4 (250 words per page double spaced)