Thursday, December 20, 2007

Taj Mahal Won't Accept Bush Dollars as India Laments Lost Value

The Taj Mahal, one of the world's architectural masterpieces, welcomes about 2.5 million visitors each year -- provided they don't try to buy tickets with dollars. India's most popular shrine announced in November that it would stop accepting the U.S. currency and take only rupees, hurling yet another insult at the once mighty greenback.

The dollar, which has been snubbed by everybody from government officials in Kuwait and South Korea to top-earning Brazilian supermodel Gisele Bundchen, may not recover its luster. Economists say the currency, which has declined in five of the past six years against the euro, is caught in a downdraft as investors pour into Asia, prompting a tectonic shift in economic power from the U.S.

``Can it be turned around? Probably not totally,'' says Riordan Roett, a professor of political science at Johns Hopkins University in Baltimore. ``The century of Asia has arrived, and the U.S. and its European allies will need to adjust to that.''

In Asia, an investment boom has boosted local currencies. China's roaring economy has grown an average of 10.4 percent in the past four years, fueled by record exports and a flood of foreign funds. That's pushed up the yuan since the government ended the currency's peg to the dollar in July 2005. As of Dec. 19, the yuan -- managed against a basket of currencies -- climbed 12 percent against the dollar.

In India, the economy has grown at its fastest pace in the past four years since independence in 1947. That's helped lift the rupee 12 percent against the U.S. currency in 2007 through Dec. 19.

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