Tuesday, January 25, 2005

Politics: EU is whining to both America and Asia that the Euro is too strong, something must be done!

Financial Times: France and Germany yesterday urged the US to rein in its excessive deficits to help arrest the dollar's slide, saying that Europe had shouldered an unfair share of the burden of dealing with global economic imbalances. The criticism from Herve' Gaymard, the French finance minister, and Hans Eichel, his German counterpart, reflect European policymakers' continued concern that the euro's strength is restricting economic growth - in spite of the US dollar's 4.6 per cent bounce against the euro during the first three weeks of 2005.
BBC: European leaders say Asian states must let their currencies rise against the US dollar to ease pressure on the euro. The European single currency has shot up to successive all-time highs against the dollar over the past few months. Tacit approval from the White House for the weaker greenback, which could help counteract huge deficits, has helped trigger the move. But now Europe says the euro has had enough, and Asia must now share some of the burden.
The falling dollar and Asian currencies tied to the dollar help both regions in exporting their goods at a cheaper price. The chances of both regions helping stagnant Europe is between no chance and less than no chance.

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