Weak dollar improves US trade gap

The US trade deficit shrank unexpectedly in August as the weak dollar boosted exports, according to figures from the Commerce Department.

The deficit, which is the difference between US imports and exports, fell to $30.7bn (£19.3bn) from a revised estimate of $31.9bn in July.

Exports rose slightly on the back of the weak dollar while imports fell.

The dollar has slipped recently, with traders moving into other currencies as the global economy begins to recover.

"I would interpret a flattening out of the trade deficit showing a broader stability in the economy," said Keith Hembre at FAF Advisors.

Imports in August totalled $158.9bn, compared with $159.8bn in July. Exports totalled $128.2bn, compared with $128bn in July.

The slight fall in imports reflects a small reduction in demand for goods among US consumers.

When the US economy begins to grow more strongly, this demand should pick up and the deficit could grow again.

Rupee weakens by 17 paise against USD

The Indian rupee depreciated by 17paise to 47.24 against the dollar in early trade on Thursday as banks bought the currency (dollar) on behalf of importers and after the USD stabilised against a basket of currencies in Asian markets.

At the Interbank Foreign Exchange (Forex) market, the local unit, which had ended six paise costlier at 47.07/08 on Wednesday, fell further to quote at 47.24.



Besides the greenback strengthening against other Asian currencies, expectations of a weak opening in the equity markets, in tandem with other Asian bourses, affected the rupee sentiment, forex dealers said.



The Asian markets are trading low by 1.5 per cent in early trade on Thursday.

Rupee down 22 paise against USD in early trade

The Indian rupee depreciated 22 paise against the US dollar in early trade on Monday, snapping its six-session upward journey, on expectations of fresh capital outflow by foreign funds as domestic bourses may open in the negative zone, in line with other Asian markets.

At the Interbank Foreign Exchange (Forex) market, the local unit, which had gained nearly 4.9 per cent during the last week, turned weak and fell 22 paise to 47.32 a dollar.


On Friday, the domestic currency had ended 27 paise higher at 47.10/12 against the greenback.


Forex dealers said the benchmark Sensex is likely to open on a weak note in line with other Asian markets, which are down up to 1.5 per cent, leading to capital outflow by foreign funds.


Month-end dollar demand also put pressure on the rupee, they added.

Rupee breaches 47 level to hit five-mth high of 46.98 a dlr

The Indian rupee continued its upward march for the sixth consecutive day and breached the crucial 47-level against the US currency for the first time after 19th December, 2008, on sliding dollar in the overseas markets.

The rupee also drew support from encouraging trend in the local stocks and continued optimism about faster reforms in the financial sector paving the way for increased capital inflows.



At the Interbank Foreign Exchange (Forex) market, the domestic currency resumed stronger at 47.15/20 a dollar from its previous close of 47.37/38 a dollar and later hit a five-month high of 46.98 against the American currency.



It, however, pared gains and was quoted at 47.14/15 a dollar in late morning trade.



Forex dealers said weak dollar overseas provided a fresh impetus to the Indian currency.



The dollar fell to its recent lows against the basket of currencies on fears about the US losing the AAA rating.



They said the rupee trimmed its gains due to some dollar buying by banks, probably on behalf of oil companies.

Pound strengthens against dollar

The pound has strengthened against the dollar, after Bank of England minutes revealed that policymakers considered boosting money supplies.

The prospect of the move, which could encourage lending - stimulating the economy - boosted sterling.

By Wednesday afternoon, one pound could buy $1.5514, up from Tuesday's close of $1.5350. A day earlier, sterling had reached a five-month high of $1.5525.

The dollar was also weaker against both the euro and the yen.

At noon, the euro was trading at 88.16p.

Meanwhile, the yen was hit by the announcement that the Japanese economy had shrunk by more than 4% in the first quarter of 2009.

With analysts seeing indications of economic recovery, there are signs that investors are moving away from the greenback, often deemed a safe haven.

In January, the pound hit a 23-year low of $1.35 against the dollar.

Last July, the pound was worth more than $2 but its value plunged as signs emerged over the degree of the downturn in the UK.

The May minutes also showed members had unanimously voted in favour of keeping interest rate unchanged at 0.5%.

The Bank of England's minutes showed the bank was open to increasing its quantitative easing plan by the maximum £75bn permitted, which would help encourage lending.

Dollar rises above 100-yen mark

The US dollar rose briefly above 100 yen in Asian trading on Friday, the first time it had done so since early November 2008.

The news boosted shares in Japanese exporters, with the likes of Sony and Toyota Motor closing higher.

The dollar later fell to 99.50 yen amid nervousness ahead of the US jobless figures due later on Friday.

In the first three months of 2009, the dollar had its best quarterly performance against the yen since 2001.

"The yen selling was not sustainable before the US jobs data release," said a dealer at a Japanese brokerage.

"Opinion may be tilted towards the yen weakening in the longer term, but the market would first like to see this major event through."

The yen has been falling in value as a result of weak Japanese economic data and speculation that Japanese investors are planning to move funds overseas in the new financial year.

Russian rouble slides to new low

The Russian rouble has hit a low after its central bank allowed the currency to devalue for the twelfth time - including nine falls this month.

It fell to 41.6 against the euro - an all time low - and to 29.3 against the dollar, the lowest level since 2005.

The currency has lost more than 20% of its value against the dollar - largely due to the slumping price of oil on which Russia's economy heavily relies.

The Kremlin has been using reserves to try and support the currency.

However concern that Russia is pumping too much cash into supporting the rouble prompted ratings agency Standard and Poor's to cut the country's credit rating earlier this month for the first time in nine years.

Borrowing plans

The rouble has also touched a new low of 34.8 roubles against the basket of euros and dollars which is its official measure within the country.

Russia's central bank, which sets the official exchange rates, does not normally allow the currency to lose more than 1% percent of its value in one day against the basket of currencies.

But it has gradually been devaluing the rouble by allowing deeper falls, with it sliding 1.5% on Monday.

Oil revenues have been the main driver of the boom enjoyed by the Russian economy in recent years.

But the sharp declines in the price of crude oil means Russia is facing economic challenges.

Its budget has been calculated on the basis if it getting at least $70 a barrel for its Urals crude - the country's main export blend. It is currently worth about $32 a barrel.

Last week the economic adviser to President Dmitry Medvedev said that the country would probably draw on further reserves and borrow from abroad to bridge the shortfall.

The central bank's first deputy chairman Alexei Ulyukayev said last week that it had opted to allow the rouble to devalue gradually instead of allowing a single, much larger devaluation.

The worsening economic outlook and the fall in the price of oil has left the government with little option.

Further falls

Russia's central bank has spent more than $100bn (£68bn) defending its currency since the summer.

Despite the fall in oil revenues, Russia possesses the world's third largest reserves of gold and foreign exchange reserves.

And the central bank is prepared to continue to defend the rouble in order to avoid a repeat of the 1998 financial crisis, when Russians rushed to withdraw their savings as the currency plummeted.

The Kremlin has warned that the global economic slowdown is continuing to take its toll - predicting that the number of people registered as unemployed would rise to about 2.2 million by the end of 2009, from the current level of 1.5 million.

Strong dollar hits Oracle profits

The business software manufacturer Oracle's profit for the three months to the end of November have slipped.

Net income only fell $7m (£4.7m) from the same period last year to $1.3bn, but it was nonetheless the first time it had not grown for three years.

Oracle said its profits would have been better if the US dollar had not strengthened so much in the quarter.

It said that if currency rates had been the same as last year its profits would have grown 11%.

"They are managing through this downturn relatively well, but they're not immune for a slowdown," said Jeff Gaggin at Avian Securities.

Oracle's revenue rose 6% during the three month period, which was worse than had been expected.

Rupee appreciates 61 paise against dollar

The Indian rupee strengthened by 61 paise against the US currency on Wednesday in opening trade on increased capital inflows by foreign funds amidst firming Asian equity markets, dollar selling by exporters and weakening of dollar against other currencies.

At the Interbank Foreign Exchange (Forex) market, the domestic currency traded at 47.30 against the greenback, a smart rise of 61 paise over the previous close of 47.91/92.



Forex dealers said that the rupee gained on dollar selling by banks and exporters after an upward trend in Asian equity markets raised hopes for strong opening on domestic bourses.



Asian markets on Wednesday opened higher with Hong Kong's Hang Seng going up 2.7 per cent, while Japan's Nikkei 225 was up nearly one per cent in early trade.



The rupee, appreciated by 13 paise at 47.91/92, a one-month high in the last trading session.



Meanwhile, the BSE Sensex closed 144.59 points higher at 9976.98 on Tuesday.

Dollar falls as Fed slashes rates

he dollar has fallen sharply against other currencies after the US Federal Reserve slashed its key interest rate to an all-time low.

Many analysts expected a cut to 0.5%, rather than the Fed's move to 0.25%.

The dollar stood at $1.4094 against the euro, $1.5511 against the pound and 88.43 yen versus the Japanese currency.

Meanwhile sterling fell to another record low against the euro amid expectations the Bank of England may cut its interest rates further.

The US interest rate is now the lowest among developed countries.

"This clearly hadn't been priced into markets with the dollar tumbling as a result," said James Hughes, a currency analyst at CMC Markets.

'Very negative'

At the beginning of December, the Bank of England reduced its rate to 2% from 3%, and notes from its monetary policy committee showed it considered an even deeper cut.

Separately, it was reported that the number of people out of work rose to the highest level since June 1999, while those claiming unemployment beneift hit a 17-year high.

"Sterling is coming under pressure after the claimant count figures were well above market expectations," Ian Stannard at BNP Paribas in London.

"It shows the UK is moving toward recession and this is very negative for sterling".

The pound stood at 1.1003 euros after hitting a record low of 1.0980 euros in earlier trading.

Dollar falls on hopes of rate cut

Sterling has stayed near record lows against the euro, while the dollar fell on talks about possible US rate cuts and car industry bail-out scepticism.

Analysts predict the Federal Reserve will announce interest rate cuts on Tuesday after a two-day meeting.

Meanwhile, the pound was put under new pressure as a survey showed another sharp drop in UK house prices.

The dollar fell to $1.3465 against the euro and $1.4983 against the pound, Sterling was at 1.1128 euros.

Bail-out factor

The dollar declined on Monday as the US government said it might use money intended for banks to help carmakers.

Some analysts think that if the plan is implemented, the financial sector will have less funds to spend if needed.

"An interim bail-out plan for US automakers by the Bush administration is certainly weighing on the dollar, with many being sceptical as to how the industry can cope in the longer term and instead thinking that letting the market take its course would be a preferred route," said currency analyst James Hughes at CMC Markets.

The euro was supported by suggestions from European Central Bank officials that interest rates in the eurozone might not fall too much further.

Interest rates are at 2.5% in the eurozone, compared with 2% in the UK and 1% in the US.

Euro and pound down on the dollar

The euro and the pound both fell against the dollar on Friday following the news that the US economy is shrinking less quickly than expected.

The euro fell to $1.272 and the pound to $1.621.

The US Commerce Department announced on Thursday that the US economy shrank by 0.3% from July to September, less than the markets had forecast.

The US interest rate cut on Wednesday had sent both currencies higher against the dollar.

The euro had traded as high as $1.315 on Thursday morning on news that the US was cutting interest rates to 1%. The pound had climbed to $1.661.

The better-than-expected US economic figures have now reversed sentiment in the dollar's favour.

And with both the European Central Bank and the Bank of England expected to cut interest rates next week, the euro and the pound could fall further.

Interest rate cuts make currencies less attractive, as they reduce the rate of return for investors.

Euro and pound move up on dollar

The euro and the pound both rose strongly on Thursday against the dollar after the Federal Reserve's decision to cut US rates to 1% on Wednesday.

The euro rose to $1.315 against the dollar in morning trading, compared with $1.285 on Wednesday night.

The pound rose to $1.661, up from $1.631 on Wednesday night and almost 14 cents higher than last Friday's six-year low of $1.526.

Despite the rate cut, the dollar edged higher against the yen, to 98.52 yen.

The rate cut ensures that "the dollar remains under pressure, at least in the short term", said Gary Thompson, head of sales trading at CMC Markets.

The rally may be short-lived, however, as both the European Central Bank and the Bank of England are expected to cut interest rates next week.

Interest rate cuts make currencies less attractive, as they reduce the rate of return for investors.

Rupee trades at 46.28 per dollar

Mumbai: The rupee rose by 60 paise to 46.28 against the US dollar in early trading today, paring yesterday's record loss of 90 paise on expectations that the Reserve Bank may intervene to stem the rupee fall.

The rupee resumed stronger at 46.38/40 a dollar from Tuesday's close of 46.89/90 a dollar, aided by a recovery in stock prices in other Asian exchanges and the RBI moves to augment dollar supply.

The RBI yesterday asked public sector banks to raise dollar deposit rates for non-resident Indians and said it would continue to sell dollars as the rupee continued to slide.

RBI also decided to allow banks to borrow more by relaxing the statutory liquidity ratio (SLR) to ease the liquidity crunch and bolster the sliding currency. The central bank also expanded the liquidity adjustment facility scheme.Foreign banks are also reported to have sold dollars in the forex market after the RBI's steps to cool the financial markets.

The rupee had lost Rs2.29, or 5.13 per cent, in the last six days alone amidst heavy capital outflows and heavy dollar demand.

Foreign funds have so far sold a net $8.4 billion worth of stocks, driving the rupee down more than 15 per cent so far in 2008.

The dollar's strength against other currencies also seems to have impacted the rupee value.

Yen Falls Against Dollar After Fed Rescue of AIG

The yen fell for a second day against the dollar after the Federal Reserve said it will lend as much as $85 billion to American International Group Inc., helping prevent credit markets from seizing up.

Japan's currency also dropped versus the Australian and New Zealand dollars on speculation an AIG rescue will encourage investors to resume taking out loans in Japan to buy higher- yielding assets elsewhere. The yen jumped the most in a decade against the greenback on Sept. 15 as mounting credit-market losses forced Lehman Brothers Holdings Inc. to file the biggest bankruptcy in history, sparking a global stocks rout.

The Fed's loan is ``likely to support the U.S. financial system and avert a catastrophe,'' said Kenichiro Ikezawa, who helps oversee the equivalent of about $3 billion as a fund manager at Daiwa SB Investments Ltd. in Tokyo. ``Risk-taking appetite will probably recover a bit. Sentiment toward the dollar isn't bad, and the yen may be sold.''

Japan's currency fell 0.3 percent to 106.00 per dollar at 7:35 a.m. in London, after sliding 0.9 percent yesterday and surging 3.1 percent on Sept. 15. Against the euro, the yen slid 0.9 percent to 150.64. It touched 147.04 yesterday, the strongest since August 2006. The dollar fell 0.6 percent to $1.4212 per euro.

Australia's dollar rose 3.1 percent to 84.90 yen from late in Asia yesterday, and New Zealand's dollar climbed 3.5 percent to 70.29 yen. The Nikkei 225 Stock Average advanced 1.2 percent, after a 5 percent drop yesterday.

Carry Trades

``A disorderly failure of AIG could add to already significant levels of financial market fragility,'' the Fed said, explaining its decision to lend money to AIG in return for a 79.9 percent stake.

Benchmark interest rates of 7 percent in Australia, 7.5 percent in New Zealand, 8.25 percent in Mexico and 13.75 percent in Brazil compare with 0.5 percent in Japan, making the nations' currencies favorites for so-called carry trades. The Bank of Japan today left its overnight rate unchanged for a 22nd straight policy meeting.

In carry trades, investors get funds in a country with low borrowing costs and invest in one with higher rates, earning the spread between the two. The yen declined 0.3 percent to 58.6007 against the Brazilian real and weakened 0.5 percent to 9.910 versus the Mexican peso.

``The news is lifting shares and calming investors,'' said Toshihiko Sakai, head of trading in foreign-exchange and financial products at Mitsubishi UFJ Trust & Banking Corp. in Tokyo. ``They are selling the yen.''

Lower Volatility

Implied volatility on one-month dollar-yen options fell to 16.93 percent today from 17.65 percent yesterday when it touched 19.50 percent, the highest since March 17. Lower volatility may encourage carry trades as it indicates a smaller risk of exchange-rate fluctuations that can erode profits.

Fed Chairman Ben S. Bernanke and his colleagues yesterday rebuffed calls by some investors for an interest-rate cut after Lehman filed for bankruptcy, signaling they will continue to address market turmoil with emergency lending and aim monetary policy at a longer-term economic forecast that may still show the economy is skirting a recession. The benchmark rate was kept at 2 percent.

Further losses in the yen may be limited by speculation Japanese investors will repatriate funds ahead of the Sept. 30 halfway point of Japan's fiscal year, according to Tomoko Fujii, head of economics and strategy at Bank of America Corp. in Tokyo.

`Upside Risks'

``The approach of the Japanese fiscal half-year end will keep domestic financial institutions sidelined in their foreign asset investment or may even foster repatriation,'' Fujii wrote in a research note yesterday. ``Upside risks to the yen will probably persist in coming weeks.''

Bank of America raised its yen forecasts, predicting the currency will trade at 104 per dollar at the end of September and 107 at the end of December. That compares with previous estimates of 108 and 110, respectively, Fujii said.

The dollar may fall before government reports today that are expected to show the U.S. housing market is deteriorating, adding to evidence of a slump in the world's biggest economy.

Housing starts fell 1.6 percent in August to an annual rate of 950,000, the lowest level since March 1991, according to the median forecast in a Bloomberg News survey of 74 economists. Building permits, a sign of future construction, probably fell 1 percent to a 928,000 pace. The Commerce Department will release the two reports at 8:30 a.m. in Washington.

``The source of global financial sector concerns, that is, the U.S. housing market, has not shown signs of a recovery,'' Fujii said.

Rate Cuts

Any gains in the pound and the euro may be limited by speculation European central banks will lower interest rates in coming months as the U.S. slowdown spreads through other countries. The U.K. currency rose 0.3 percent to $1.7881.

The Bank of England will release minutes from its policy meeting ended Sept. 6 at 9:30 a.m. in London. The central bank kept its benchmark rate unchanged at 5 percent. BOE Governor Mervyn King said yesterday inflation will peak ``soon'' and then slow ``sharply'' in 2009.

Economists surveyed by Bloomberg forecast that the European Central Bank will keep its benchmark rate on hold at 4.25 percent this year before cutting it in the first quarter of 2009.

Weaker Pound, Euro

``The pound and the euro will be hit more as more weakness spreads through Europe,'' said Thomas Harr, a senior currency strategist in Singapore at Standard Chartered Plc, the U.K. bank that gets most of its profit from Asia. ``The BOE will start cutting rates quite significantly from the fourth quarter. The ECB will have to follow.''

The pound may fall to $1.58 and the euro may decline to $1.30 by the middle of next year, Harr said.

Luxembourg Finance Minister Jean-Claude Juncker, who heads a group of euro-area counterparts, said today the euro region and Germany, its biggest member, will escape recession even as economic growth weakens.

``I don't see the danger of recession in the deeper sense of the word,'' Juncker told Germany's Deutschlandfunk radio. ``Economic growth will clearly weaken.''

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NEW YORK, Aug 1 (Reuters) - The U.S. dollar climbed to five-week peaks against the euro and three-week highs against the British pound on Friday as better-than-expected economic data allayed worries about a much sharper slowdown.

The yen, on the other hand, gained broadly, benefiting from heightened stress in financial markets on news that General Motors (GM.N: Quote, Profile, Research) had hefty losses in the second quarter. That dragged U.S. stocks lower and triggered safe-haven bids for Treasuries.

"U.S. dollar sentiment has certainly changed for the better over the last couple of weeks," said Mark Frey, head foreign exchange trader at Custom House, a global payments dealer in Victoria, British Columbia.

"The U.S. economy has gone through some tough phases, but the jobs number was negative, but still better than expected. I think, more importantly, recent consumer confidence numbers and leading indicators, which are more forward-looking, have been more positive," he added.

Friday's data showed that U.S. employers eliminated 51,000 jobs in July, lower than market expectations for a payrolls decline of 75,000. A separate report said U.S. factory activity was unchanged in July, compared with the previous month, but above market forecasts

Dollar Rises to One-Month High on View U.S. Slowdown Spreading

Aug. 2 (Bloomberg) -- The dollar rose to a one-month high against the euro as the pace of job erosion in the U.S. slowed while a decline in German retail sales indicated economic weakness is spreading to other developed countries.

The currency increased for a third week against the euro, its longest stretch of gains since May 2007. The Australian and New Zealand dollars fell against all of the other major currencies as reports showed Australia's manufacturing contracted and business confidence in New Zealand fell.

``The labor market hasn't changed dramatically, but certainly it's a relief that things haven't gotten worse,'' said Thomas Benfer, vice president of foreign exchange at BMO Capital Markets in New York. ``It looks like the global economy is slowing down. We're not going to see a surge in the dollar, but it's moving in the right direction.''

The dollar appreciated 1 percent this week to $1.5564 per euro, from $1.5709 on July 25. It touched $1.5515, the strongest since July 24. The dollar dropped 0.1 percent to 107.71 yen, from 107.84. Japan's currency gained 1 percent to 167.55 per euro, for the biggest weekly gain since early May. It touched 166.99 yesterday, the highest level since July 17.

The Federal Reserve will keep its target lending rate at 2 percent on Aug. 5, while the European Central Bank will hold its main refinancing rate at 4.25 percent two days later, according to forecasts of economists surveyed by Bloomberg News.

Weaker Pound

The pound fell to $1.9727, the lowest level since July 10, as an index of British manufacturing dropped in July to the weakest since December 1998. The Bank of England is forecast to hold its target rate at 5 percent on Aug. 7.

``Sterling at current levels is a good sell,'' said Meg Browne, a senior currency strategist at Brown Brothers Harriman & Co. in New York, in an interview on Bloomberg Television.

The Aussie dropped 2.6 percent this week after touching 93.02 cents yesterday, the lowest since May 2, as PricewaterhouseCoopers and the Australian Industry Group said the manufacturing index fell to 46.9 in July. The Reserve Bank of Australia will keep its cash target at 7.25 percent on Aug. 6, according to the median forecast of 24 economists.

New Zealand's currency, known as the kiwi, decreased 2 percent after reaching 72.47, the weakest since Sept. 19. A net 43.2 percent of companies expect the economy will worsen over the next 12 months, up from 38.7 percent in June, ANZ National Bank Ltd. reported this week.

U.S. Payrolls

U.S. payrolls shrank in July for a seventh straight month, decreasing by 51,000, matching the previous month's decline, the Labor Department said yesterday in Washington. The median forecast of 79 economists surveyed by Bloomberg News was for a reduction of 75,000. The unemployment rate rose to 5.7 percent, the highest since March 2004, from 5.5 percent.

``The market will start to focus on the rise of the unemployment rate, which could cause concerns about the weakness of the economy,'' said Dustin Reid, a senior currency strategist at ABN Amro Bank NV in Chicago. ``I'm not ready to call a bottom in the dollar just yet.'' The dollar may weaken to $1.58 per euro in the next couple of weeks, said Reid.

The U.S. economy shrank at the end of 2007 and grew less than forecast in this year's second quarter, figures from the Commerce Department showed July 31.

The 15-nation euro fell yesterday versus the dollar as Germany's Federal Statistics Office in Wiesbaden said retail sales, adjusted for inflation and seasonal swings, dropped 1.4 percent in June after increasing 0.5 percent in the prior month. The median forecast of 29 economists surveyed by Bloomberg News was for a decrease of 0.5 percent.

Trichet on Rates

ECB President Jean-Claude Trichet said on July 3 that he had ``no bias'' or ``pre-commitment'' after policy makers increased the main refinancing rate a quarter-percentage point.

``We're seeing the European numbers coming up very soft, so that will put pressure on the ECB not to do anything until the end of the year,'' said Alan Kabbani, a senior currency trader at Wachovia Corp. in Charlotte, North Carolina. ``I'm thinking a little bit more positively on the dollar.''

The yen rose to a two-week high of 166.99 against the euro yesterday as slowing global growth prompted traders to pare holdings of higher-yielding assets funded in Japan.

Japan's currency rose to a two-month high of 100.07 per Australian dollar and a four-month high of 77.90 per New Zealand dollar on speculation investors reduced carry trades in which they get funds in countries with low borrowing costs and invest where returns are higher. The target lending rate of 0.5 percent in Japan compares with 8 percent in New Zealand.

Dollar

The dollar (often represented by the dollar sign: "$") is the name of the official currency in several countries, dependencies and other world regions.


The German name Thaler came from the Bohemian coin minted from the silver from a rich mine at Joachimsthal - Jáchymov (St. Joachim's Valley) in Bohemia (a member of the Holy Roman Empire beginning in 1515, since 1945 part of the Czech Republic). Not long after issuance, these coins gained the name Joachimsthalers. From there, coins gained the name "thaler" regardless of the issuing authority. The basis of "thaler" comes from Joachimsthaler. The name is historically related to the tolar, in Germany Reichsthaler, Slovenia (Slovenian tolar) and Bohemia, the daalder in the Netherlands and daler in Sweden, Denmark, and Norway. "Guildiner" can be traced to 1486 when Archduke Sigismund of Tyrol, a small state north of Venice, issued a dollar-sized coin which was referred to as a "guildiner". Silver supplies were small which limited coinage.

The Dutch lion dollar circulated throughout the Middle East and was imitated in several German and Italian cities. It was also popular in the Dutch East Indies as well as in the Dutch New Netherlands Colony (New York). The lion dollar also has circulated throughout the English colonies during the 17th and early 18th centuries. Examples circulating in the colonies were usually fairly well worn so that the design was not fully distinguishable, thus they were sometimes referred to as "dog dollars." This Dutch currency made its way to the east coast due to the increased trading by colonial ships with other nations. By the mid-1700s, it was replaced by the Spanish 8 reales.

The name "Spanish dollar" was used for a Spanish coin, the "real de a ocho" and later peso, worth eight reals (hence the nickname "pieces of eight"), which was widely circulated during the 18th century in the Spanish colonies in the New World and in Spanish territories in Asia, namely in the Philippines.The use of the Spanish dollar and the Maria Theresa thaler as legal tender for the early United States and its fractions were the mainstay of commerce. They are the reasons for the name of the nation's currency.[citation needed] By the American Revolution in 1775, these Spanish currency became even more important. They were backed by paper money authorized by the individual colonies and the Continental Congress. However, the word dollar was in use in the English language as slang or mis-pronunciation for the thaler for about 200 years before the American Revolution, with many quotes in the plays of Shakespeare referring to dollars as money. Spanish dollars were in circulation in the Thirteen Colonies that became the United States, and were legal tender in Virginia.

Coins known as dollars were also in use in Scotland during the 17th century, and there is a claim that the use of the English word, and perhaps even the use of the coin, began at the University of St Andrews. This explains the sum of 'Ten thousand dollars' mentioned in Macbeth (Act I, Scene II), although the real Macbeth upon whom the play was based lived in the 11th century, making the reference anachronistic; however this is not rare in Shakespeare's work.

In the early 19th century, a British five-shilling piece, or crown, was sometimes called a dollar, probably because its appearance was similar to the Spanish dollar. This expression appeared again in the 1940s, when U.S. troops came to the UK during World War II. At the time a U.S. dollar was worth about 5s., so some of the U.S. soldiers started calling it a dollar. Consequently, they called the half crown "half a dollar", and the expression caught on among some locals and could be heard into the 1960s.

In the early days of the United States, the term "Dollar" was commonly known as a coin minted by Spain called the Spanish Milled Dollar. These coins were the standard money then in use in the country. On April 2, 1792 Alexander Hamilton, then the Secretary of the Treasury, made a report to congress that were the result of his task to scientifically determine the amount of silver in the Spanish Milled Dollar coins that were then in current use by the people. As a result of this report, the Dollar was defined (See the Act of April 2, A.D. 1792 of the Senate and House of Representatives of the United States of America in Congress assembled, Section 9) as a unit of measure of 371 4/16th grains of pure silver or 416 grains of standard silver. (Standard silver being defined as 1,485 parts fine silver to 179 parts alloy; See Section 13 of the Act.). Therefor paper is not the dollar, instead, it is 'worth', not 'is', 1 dollar (U.S Silver certificate.) In section 20 the Act, it is specified that the "money of account" of the United States shall be expressed in those same "dollars" or parts thereof. All of the minor coins were also defined in terms of percentages of the primary coin the dollar such that a half dollar contained 1/2 as much silver as a dollar, quarter dollars, 1/4th etc. In an act passed on January 18, 1837 the alloy was changed to 10% thus having the effect of containing the same amount of silver but being reduced in weight to 412 1/4 grains of standard silver which was changed to 90% pure and 10% alloy. On February 21, 1853 the amount of silver in the fractional coins was reduced so that it was no longer possible to combine the fractional coins to come up with the same amount of silver that was in the dollar. Various acts have been passed over the years that affected the amount and type of metal in the coins minted by the United States such that today, there is no legal definition of the term "Dollar" to be found in any Statute of the United States. [Sources for this paragraph include the United States Statutes at Large, A Guide Book of United States Coins by R.S. Yeoman, MONEY - Ye shall have honest weights and measures by James E. Ewart.

Today the closest definition to a dollar comes from the United States code Title 31, Section 5116, paragraph b, subsection 2, "The Secretary [of the Treasury] shall sell silver under conditions the Secretary considers appropriate for at least $1.292929292 a fine troy ounce." However Federal Reserve banks are only prejudiced to deliver tax credits instead of money. The silver content of U.S. coinage was mostly removed in 1965 and the dollar essentially became a baseless free-floating fiat currency; though the U.S. Mint continues to make silver $1 bullion coins at this weight. It is believed that the original green color and other specific designs of a paper dollar were introduced by 2 Armenian brothers from Massachusetts who were Near-Eastern immigrants