The dollar rose by about 35 percent in real terms from 1995 through the end of 2001, supporting the booming US economy of the late 1990s but pushing the current account deficit to a record high of almost 5 percent of GDP. This special report provides alternative views of how large a dollar depreciation would be needed to restore a sustainable position (Jim O'Neill, Michael Rosenberg, and Catherine Mann), analyzes the impact of currency misalignments on each of the three major economies (Martin Baily for the United States, William Cline for Japan, and Daniel Gros for Euroland), and discusses the role of exchange market intervention in addressing the issues (Kathryn Dominguez, Edwin M. Truman, and Ernest Preeg).