Euro Has Reached "Pain Threshold"

EU Business Lobby Says Euro Has Reached "Pain Threshold"

By William Echikson, Dow Jones Newswires | 10 October 2007

BRUSSELS— (Dow Jones)— A leading pan-European business lobby said Wednesday that the euro had reached the "pain threshold for European companies" and urged the continent's politicians to press the U.S., Japan and China to reevaluate their currencies at the upcoming meeting of the Group of Seven leading industrial nations.

"Having crossed 1.40 against the U.S. dollar and appreciating against the Chinese yuan and Japanese yen, the euro exchange rate has attained a pain threshold for European companies," BusinessEurope President Ernest-Antoine Seilliere said in a letter dated Oct. 2 to Jean-Claude Juncker, the chairman of the Eurogroup.

The next G7 meeting in Washington Oct. 20-21 "will be a unique opportunity to raise these issues forcefully and proclaim that the euro cannot be the variable of adjustment to reduce the U.S. external deficit," Seilliere added.

The business lobby decried what it called "political interference" in the European Central Bank's monetary policy. But it said it expects the bank "to remain pragmatic as regards its interest rate policy." The risk of "further appreciation of the euro should naturally rank high on the ECB's list of concerns," the letter continued.



Normxxx    
______________

The contents of any third-party letters/reports above do not necessarily reflect the opinions or viewpoint of normxxx. They are provided for informational/educational purposes only.

The content of any message or post by normxxx anywhere on this site is not to be construed as constituting market or investment advice. Such is intended for educational purposes only. Individuals should always consult with their own advisors for specific investment advice.