Europe gets US help in bid to tame euro
European finance ministers got help from Washington on Saturday as they renewed an endeavor to prevent the euro's rise getting out of hand.business Updated: Apr 22, 2007 05:10 IST
European finance ministers got help from Washington on Saturday as they renewed an endeavor to prevent the euro's rise getting out of hand.
Whether that would prevent the euro rising further on Monday was unlikely, said Stephen Jen, a currency strategist at investment bank Morgan Stanley, but it coincided well with a new bid by the Europeans to calm traders' ardor for the currency.
In an interview released overnight, U.S. Treasury Secretary Henry Paulson said that he still believed in a strong dollar -- confirming a line Europe was striving to convey to markets which keep betting on further euro rises versus the dollar and yen.
"As I think you know, I believe very strongly that a strong dollar is in our nation's interest, and I'm a big believer in currencies being set in a competitive, open marketplace," he said in a U.S. Public Broadcasting Service interview.
The comment plugged a hole in the message European officials made during talks in Berlin on Friday and Saturday, namely that markets could get burned by aggressive exchange rate bets.
European Central Bank President Jean-Claude Trichet said he had already heard Paulson reiterate Washington's position during closed-door talks among the Group of Seven industrialized powers on April 13 and had noted the point "with interest."
He was addressing a news conference during Berlin meetings where some people conceded that a degree of euro appreciation, although potentially bad for exporters, was logical when the economy of the region was now growing healthily again.