Euro strength needs to be reduced, ECB told
- 10th July 2014
- Business & Economy
The European Central Bank (ECB) is being urged to make a concerted effort to reduce the strength of the euro.
Fabrice Bregier, president and chief executive officer of Airbus, believes that an increasingly strong euro is hampering the ability of the eurozone to grow and thrive.
In an interview with the Financial Times, he called on decision makers within the European Central Bank to focus their attention on cutting the “crazy” strength of the euro.
Mr Bregier suggested that one way in which this can be achieved is through reducing the “excessive” value of the euro against the dollar by ten per cent.
He said that Europe simply cannot be the only economic entity to not consider its “currency as a weapon” and a “key asset to promote its economy”.
“Let’s look at what the Japanese are doing,” he told the newspaper. “They have devalued the yen by 20 per cent. Here, we just have to go back to more normal exchange rates.”
He added by saying that “we just have to give long-term visibility to the markets that this is now a key political willingness of the European nations”.
Mr Bregier’s comments come on the back of Christian Noyer, an executive board member at the ECB and governor of the Bank of France, arguing that low interest rates in the eurozone is keeping financial conditions restrictive.
Consequently, according to them, this is preventing member states from experiencing the best conditions that are necessary for positive and robust economic recovery.
“While nominal conditions are more accommodating in the euro area than in the US, real indicators point to a more restrictive stance,” he recently told delegates at a banking industry conference.
“The financial economy may be heading towards a bad equilibrium that would threaten the real economic recovery.”
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