Stronger Dollar Could Rally Economy: Gambling Affiliates Worry
The US dollar this week hit a 6 month high against the euro and it might not be done just yet.
It is widely believed that the dollar will be a main beneficiary of a global economic slowdown as German business confidence dropped in August more than forecast.
The US currency was headed for the biggest monthly gain since the 15-nation euro debuted in 1999.
''The dollar is leaning heavily on bad news elsewhere,'' said Alan Ruskin, head of international currency strategy in North America at RBS Greenwich Capital Markets. ''The market is coming around to the view that the extremely high level in the euro-dollar is not justified.''
Against the euro, the dollar increased 0.7% to $US1.4651 in New York, from $US1.4754.
It's not all good news for the dollar as fewer Europeans are likely to travel to and from the United States - previously a huge bargain. Likewise, Europeans were among the last remaining groups still buying up prime real estate in the US, mostly in cash.
For online gambling affiliates living in the United States who have now become more dependent on foreign gaming sites, a strong dollar could result in decreased revenue generated.
Several leading gambling firms departed from the US market following passage of the Unlawful Internet Gaming Enforcement Act in October 2006. Since that time, the numbers of people betting online and playing poker over the Internet throughout Europe has increased dramatically. Coupled with a generous conversion rate, savvy US online gambling affiliates have been able to recoup a good chunk of their losses in the months immediately following passage of the UIGEA.
"There are some really high rollers in Europe if you're lucky enough to reel them in," said one online poker affiliate.
Likewise, whereas US-facing brands have had difficulty processing checks for gaming affiliates, the European firms are well equipped to do so. The only drawback is that some Euro operators have required their US affiliates to open accounts offshore.
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Jagajeet Chiba, Gambling911.com
