Spring 1996 - Volume 1, No. 4
Tennessee Trade Weighted Dollar Index
Tennessee's trade-weighted dollar strengthened over the last quarter of 1995, continuing the general trend of the past several years. Only four of the twenty two currencies composing the index rose against the dollar; of the remaining eighteen, most fell modestly, but Japan's yen weakened almost five percent, while the Mexican peso continued to be the major problem: it fell nearly twenty percent over the quarter. As noted in the last issue of Global Commerce, changes in the value of this index have fairly accurately predicted changes in Tennessee's rate of export growth about six months ahead of time. Last quarter's rise in the dollar thus suggests a continuing slowdown in export growth through the middle of 1996. However the dollar index has now remained essentially flat for the past four months (the index in November was at 111.1, in February 112.3) which should begin to help exports in the latter part of the year.
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