The euro is set to continue its recent rally on the back of strong growth in the 11 countries that make up Europe's single currency zone, European Central Bank president Wim Duisenberg said in an interview published Saturday, December 9.
The Dutchman told Japan's biggest selling daily, the Yomiuri Shimbun, that the euro's rise this week to a three month-high against the dollar reflected economic fundamentals.
"The euro is still undervalued," he said. "It has reversed its trend to meet fundamentals."
He added: "The euro still has the potential to go up further. What is happening now may be the first sign (of the euro's recovery)."
The Dutch ECB chief dismissed fears of a slowdown in the euro-zone economy next year. "I do not share such concerns. We will see about three-percent growth for both 2001 and 2002. It may be even stronger."
The euro has been buoyed this week by signals from the US Federal Reserve that it could cut interest rates early in the New Year in response to growing signs of a slowdown in US growth.
In New York on Friday afternoon, the euro was trading at $0.8879. It has risen by nearly five cents over the previous two weeks.
The unit jumped to $0.8970 in London trade Thursday, just off the level of $0.8992 it hit on September 22 after the Group of Seven central banks intervened to help the euro.— (AFP)
© Agence France Presse 2000
© 2000 Mena Report (www.menareport.com)