US Dollar Roller CoasterPublished September 19, 2008 by OCR Editor
Whether it goes up, or goes down, there's always someone complaining. But how will the stronger US dollar affect the gambling world?
After three years of steady weakening against the British pound and Japanese yen, it looks like the US making a comeback. In the last 9 months, it has shown continuing strength against the world's other major currencies. But how will this affect the online and land-based gambling industries?
The greenback is essentially reveling in bad news that appears elsewhere - in particular in Europe, where business slowdown has been dramatic. Slower business means lower European interest rates, and therefore a stronger US dollar.
However, visitors to the US, including those frequenting the casinos of Nevada, will feel the pinch as their foreign currencies will buy less US dollar-denominated casino chips. Online gambling aficionados will also feel the pinch as a stronger US dollar may affect income generation.
During the course of the last two years, many US online casino operators have moved their operations overseas, resulting in a huge increase in online betting activity. This gambling exodus followed US legislation known as the Unlawful Internet Gaming Enforcement Act. Many ex-pat online gambling operators have been able to ride the currency exchange wave and make some good profits. Time will tell whether they can now adjust quickly enough to take advantage of the character of the new and improved US dollar.
Finally, online banking has been another important aspect to the new European operations where former US online casinos had great difficulty with stuffy US gambling legislators. Their European counterparts are much more willing to permit the free flow of cash through online payment systems and banks, which can only be good news for online casino fans.