ECB dismisses woes over euro credibility

08:16, December 21, 2010      

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The European Central Bank (ECB) Chief Jean-Claude Trichet dismissed on Monday worries over the euro value which lost strong ground following last week's Irish sovereign rating downgrade by the Moody's.

"The euro is a credible currency as it kept its value during the last twelve years. The problem was not the currency. The currency maintained its value. It is credible. It inspires confidence ...," Trichet told the local radio channel Europe1.

"The serious crisis we have is not an euro crisis; it is a crisis of financial stability. We have always said to the states 'be careful, respect the Stability and Growth pact, pay close attention to your budget deficits as they are a weakness that you must absolutely correct'," he added.

Trichet urged countries and financial institutions of the euro zone to assume their individual and collective responsibility in the current crisis and improve good governance to regain investors' confidence.

"We must at the same time fully assume individual responsibility -- the good management of each country and for those which have a recovery program, to strictly enforce the recovery program -- and, of course, collectively via a much better governance and a stabilization fund that is able to assume all its responsibilities," the ECB chief stressed.

On Monday session, the euro was traded at 1.3156 U.S. dollars, after sliding to around 1.3125 dollars in early trade, its lowest since Dec. 2 as concerns over debt crisis in the euro zone pushed investors to look for safer currencies.

Source: Xinhua
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