Trade Deficit Leaps Again (washingtonpost.com): " At its current pace, Lachman noted, the broadest measure of the trade gap is nearing 6 percent of gross domestic product, substantially higher than it was in the late 1980s when a declining dollar upset world financial markets and fueled a plunge in U.S. stock prices.

Currency traders began heavily selling the dollar as soon as the report was released in the morning. The U.S. currency had rebounded in the first few trading days of the year, but yesterday it sank against the euro. A euro bought $1.3271 in late New York trading, compared with $1.3123 on Tuesday. A dollar bought 102.35 Japanese yen, down from 103.25.

"The latest numbers did not shake the Bush administration's position that the trade gap should be viewed as a symptom of the U.S. economy's relative strength."

(Via Google News.)