Exchange Rate

China pledged yesterday to "push ahead firmly and steadily" toward a more flexible exchange rate, yet stopped short of providing a timetable for when it will shift from the decade-old currency peg that has been blamed for widespread job losses in American manufacturing industries. China has fixed the value of the yuan at about 8.3 to the dollar since 1995. The country's biggest trading partners, including the United States and Japan, say that depresses the value of the currency and hands Chinese producers an unfair trading advantage by making their goods cheaper abroad.

Chemical maker W.R. Grace & Co. said Wednesday that its net income in the first quarter fell about 13 percent from the year-earlier period, in line with its warning to investors and analysts earlier in the month. The Columbia company said sales volumes didn't drop, but revenue took a hit as a result of lower pricing and an unfavorable change in the Venezuelan exchange rate. "Sales and earnings were below our expectations," CEO Fred Festa said in a statement. W.R. Grace said it produced $52.9 million in net income during the first three months of the year, compared with $60.9 million in the first quarter of last year.

A dollar doesn't buy what it used to in most foreign countries anymore, so why make things worse by cheating yourself out of the best possible exchange rate? I was reminded of this while standing in line at an American Express office recently to buy traveler's checks. After waiting for 15 minutes (my limit for waiting to buy anything), I left without the traveler's checks. Ahead of me was a woman buying euros (cash notes, not traveler's checks) to take with her on vacation. The clerk quoted her an exchange rate of $1.34 per euro, 10 cents on the dollar higher than that day's official rate of $1.24.

The Baltimore Green Currency Association will formally launch the BNote, a new local currency, at EcoFest in Druid Hill Park on Saturday, April 16. You'll be able to purchase the bills, in $1 and $5 increments, from 12 p.m. to 5 p.m. at the festival, as well as from noon to 6 p.m. on Sunday at Localize It! in the 3500 block of Ash Street in Hampden. BNote's backers want to encourage people to support independent, local businesses by using the alternative currency --- thus keeping the value of those notes within our communities.

LONDON -- European finance ministers said yesterday that they opposed a "two speed" approach to monetary unification that would allow one group of nations to proceed quickly toward a single currency while leaving others to deal first with domestic economic problems.The statement came at the end of a day in which European currency markets remained relatively stable. The franc gained in value against the German mark, removing the French currency from any immediate danger of devaluation.(The dollar closed below 120 yen in New York, falling to 119.65 yen yesterday from 120.75 yen late Friday, as currency traders grew increasingly concerned about the weak United States economy and the presidential race, and sought a havenfrom the dollar and the turbulent European currencies.

In a move that cast new gloom over Europe's ambitions to become a unified economic power on the world stage, European Community finance ministers early today diluted their foundering system of fixed exchange rates, nearly to the vanishing point.The modification will effectively allow other EC currencies in the system, including the French franc, to be devalued by slightly more than 13 percent against the German mark, the EC's strongest currency.No currency was actually devalued, however. Instead, the finance ministers decided that each currency would be permitted to lose up to 15 percent of its value against the EC's strongest currency.

The Baltimore Green Currency Association will formally launch the BNote, a new local currency, at EcoFest in Druid Hill Park on Saturday, April 16. You'll be able to purchase the bills, in $1 and $5 increments, from 12 p.m. to 5 p.m. at the festival, as well as from noon to 6 p.m. on Sunday at Localize It! in the 3500 block of Ash Street in Hampden. BNote's backers want to encourage people to support independent, local businesses by using the alternative currency --- thus keeping the value of those notes within our communities.

WILLIAMSBURG, Va. -- If President Bush wants to make an immediate political and economic impact on the Western Hemisphere, he can encourage an existing trend toward dollarization of Latin American economies. Most Latin American currencies are tied to the dollar. Some nations use traditional fixed exchange rates in which the central bank promises to redeem domestic currency for dollars at a set price. Argentina's 10-year-old currency board is stricter. It must hold a dollar in assets for every peso liability it creates.

Last September it was the British and the Italians. Now it is the French, the Danes, the Spanish and the Portuguese. All have succumbed to the power of the mighty mark, backed up by a balky Bundesbank, which demonstrates that when Germany's national interests collide with its responsibilities as economic anchor of the European Community, national interests will win every time.For the French, the decision to let the franc float down as much as 15 percent below parity rates against the Deutsche Mark, as compared to a 2.25 percent limit before the weekend currency crisis, is a humiliation.

NEW YORK -- U.S. stocks slid yesterday as Microsoft Corp. shares plunged and the price of gold soared to a three-year high.The Dow Jones industrial average closed 27.95 points lower, at 3,539.47, as computer-guided sell orders hit the market. Minnesota Mining & Manufacturing Co., AlliedSignal Inc. and Walt Disney Co., all of which reported second-quarter earnings in the past two days, led the decline."This still is a market that takes no prisoners and is very unforgiving" of companies that fail to match expectations, said Alfred Goldman, director of technical research at A. G. Edwards & Sons in St. Louis.

Spice maker McCormick & Co., which has been buffeted by rising commodity prices, reported yesterday that fiscal third-quarter profit rose 32 percent as the local company benefited from a weak dollar that helped boost sales overseas. McCormick had net income of $57 million, or 43 cents per share, in the three months through August, compared with $43 million, or 32 cents a share, in the comparable quarter last year. Sales rose 8 percent, with 2 percent of that increase attributed to favorable currency exchange rates.

Beating the euro is a hot topic among travelers these days. Here are 10 suggestions, gleaned from New York Times readers, for saving money on a European vacation. 1. Take the least expensive route to Europe you can find, even if the destination wasn't in your plans. Then use a low-cost carrier like Ryanair to fly on to a city on your list. AFGHANISTAN Lonely Planet / $18.19 Lonely Planet has issued its first guide to Afghanistan. This is not the typical guidebook for the typical tourist; it is meant for those visiting the country on business, as well as for the few independent ones who are up for the challenge.

THE DIGITAL PRINTER-copier-scanner, made by Lexmark in China for export to the United States, was going for $59.96 at Circuit City last week. China's move on Thursday to strengthen its currency, which Treasury Secretary John W. Snow said "will be a significant contribution toward global financial stability" when phased in, would raise the device's price, assuming the cost is passed along, to $61.16. That's a 2 percent difference - $1.20. Kind of puts all the hullabaloo in perspective, doesn't it?

China pledged yesterday to "push ahead firmly and steadily" toward a more flexible exchange rate, yet stopped short of providing a timetable for when it will shift from the decade-old currency peg that has been blamed for widespread job losses in American manufacturing industries. China has fixed the value of the yuan at about 8.3 to the dollar since 1995. The country's biggest trading partners, including the United States and Japan, say that depresses the value of the currency and hands Chinese producers an unfair trading advantage by making their goods cheaper abroad.

A dollar doesn't buy what it used to in most foreign countries anymore, so why make things worse by cheating yourself out of the best possible exchange rate? I was reminded of this while standing in line at an American Express office recently to buy traveler's checks. After waiting for 15 minutes (my limit for waiting to buy anything), I left without the traveler's checks. Ahead of me was a woman buying euros (cash notes, not traveler's checks) to take with her on vacation. The clerk quoted her an exchange rate of $1.34 per euro, 10 cents on the dollar higher than that day's official rate of $1.24.

Between tables at his Ristorante La Tavernetta in Rome, a hundred yards from the famous Spanish Steps, Daniele Pepi serves up his assessment of the euro, the new currency now being used across Europe. "For me it's good," he says. "I like to travel, and this will make it easier." Then he points to the checkout counter of the small family restaurant in which his mother prepares the pasta each morning and he and his father serve it at night. "For the business, it is no good. I have to do this calculation for each customer."

LONDON -- The turmoil in the European currency markets abated somewhat yesterday as a joint effort between France and Germany stabilized the value of the franc.Analysts said that the volume of buying and selling in the foreign exchange markets slowed substantially, and that the odds were improving that Europe's tattered monetary system would hold together.But they said the franc and several other weak currencies remained vulnerable to the waves of speculative pressure that forced the devaluation last week of the British, Italian and Spanish currencies and led Britain and Italy to leave the European system of stable exchange rates.

This month, Brazilian voters re-elected President Fernando Henrique Cardoso despite the certain knowledge that he was determined to make their economic lives tougher. The hemisphere's economic future might be riding on Brazil's short-term misery.Before the voting, public opinion polls revealed the stunning paradox: As expectations about the Brazilian currency's exchange rate worsened, support for Cardoso increased.Voters' deeper fear was of his main opponent, a labor leader universally known as Lula.

WILLIAMSBURG, Va. -- If President Bush wants to make an immediate political and economic impact on the Western Hemisphere, he can encourage an existing trend toward dollarization of Latin American economies. Most Latin American currencies are tied to the dollar. Some nations use traditional fixed exchange rates in which the central bank promises to redeem domestic currency for dollars at a set price. Argentina's 10-year-old currency board is stricter. It must hold a dollar in assets for every peso liability it creates.

This month, Brazilian voters re-elected President Fernando Henrique Cardoso despite the certain knowledge that he was determined to make their economic lives tougher. The hemisphere's economic future might be riding on Brazil's short-term misery.Before the voting, public opinion polls revealed the stunning paradox: As expectations about the Brazilian currency's exchange rate worsened, support for Cardoso increased.Voters' deeper fear was of his main opponent, a labor leader universally known as Lula.