European Union Finance Ministers Gather to Discuss the Euro's Strength and EU Budget Rules
Published:
20 January 2004 y., Tuesday
European Union finance ministers were expected to face worries over the euro's strength and divisions over France and Germany's bending of EU budget rules as they gathered Monday night for the first time this year.
Ministers concerned over the euro's recent multi-record-breaking surge against the dollar in recent weeks will take some heart by a minor greenback resurgence Friday that held steady in early European trading Monday with the EU currency down 5 cents from last week's highs, at around $1.23.
However, analysts cautioned that the turnaround could be temporary, and some politicians remain concerned that the soaring euro could stifle a fledging economic recovery in Europe by making exports too expensive against American competition.
French Prime Minister Jean-Pierre Raffarin last week said the best level for the euro would be "around parity" with the U.S. dollar.
After weeks of playing down the impact of the stronger euro, EU officials acknowledged growing concern.
"The language being used for the EU position ... has changed already since the beginning of the year, giving more emphasis to the dangers linked to volatility," EU spokesman Gerassimos Thomas told reporters ahead of the meeting.
However diplomats said it was unclear whether the 12 euro-zone finance ministers meeting Monday evening would issue a joint statement on the exchange rate. Austrian Finance Minister Karl-Heinz Grasser said he did not expect them to intervene.
On Tuesday, ministers from non-euro EU nations, Britain, Sweden and Denmark, join the talks. Among the issues will be a look at lessons to be drawn from the meltdown at Italian food giant Parmalat.
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