BRUSSELS (Reuters) – The euro exchange rate is too strong for euro zone exporters, the president of the European Council said on Friday.
Herman Van Rompuy, who represents European Union governments in Brussels, also said the economic aspects of the euro crisis, such as low growth, persisted, although the threat to the common currency’s existence had passed.
“The existential threat on the euro, that is over … We’ve seen it on the financial markets. There is much more convergence also in the spreads (on euro zone government bond yields),” he said at an event organised by the German Marshall Fund of the United States, a think-tank.
“We see it also in the exchange rate. The euro is even too strong for our exporters. The euro even became, with the crisis in the emerging countries, some kind of safe haven. So I say often the existential threat is behind us but the problems are not over,” he said.
France’s Prime Minister Jean-Marc Ayrault made similar comments last week when he was quoted as saying that the euro was “a bit” overvalued, but that this should not discourage France from making efforts to regain competitiveness.
“A strong euro can penalise certain businesses and help others. But for all that, it’s true that the euro is a bit overvalued,” Ayrault told Les Echos daily, saying the International Monetary Fund agreed.
(Reporting by Adrian Croft; Editing by Gareth Jones)