Dollar Hit as Emerging Economies Fight Inflation

$108 oil pushes gas prices higher
By Jim O'Neill,  Newser User
Posted Mar 11, 2008 7:32 AM CDT
A woman walks past currency signs of Yuan, euro and U.S. dollar at a money exchange shop in Hong Kong.   (Associated Press)
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(Newser) – A weak US dollar continued to fuel surging commodity prices today, keeping oil near $108 a barrel and moving a gallon of gas to $3.225, with analysts predicting near $4 prices by spring, the Wall Street Journal reports. Stress on the greenback is coming from not only major but minor currencies, as developing nations fight inflation by relaxing currency controls.

Surging prices for commodities are prompting more central banks, including emerging nations, to allow their currencies to rise against the dollar, which has lost 4.9% to the euro and 8.7% to the yen this year. Experts say most Asian currencies are poised for strong growth; China’s yuan, for example, has grown 3% against the dollar this year.