Exchange rate euros news – Zhu Min asks Europe to ‘keep faith’ in currency.

February 18th, 2013

Exchange rate euros is to be affected significantly in the coming future as the fates of Greece and Spain are cemented during an EU summit that will take place between the 18th and the 19th of October.  Amidst the uncertainty and flux the International Monetary Fund’s deputy managing director Zhu Min has shared his thoughts about the Eurozone crisis at a World Economic Forum meeting in China.

Speaking at the event, Min acknowledged the uncertain fate of the Eurozone by saying that “…the crisis is not over.  We are still in the middle of it and there is some way to go…  But it is moving in the right direction – that is very important.  We should have confidence, and we should have confidence in the euro.”

The rallying speech comes amidst fears that the increasingly-likely ‘Grexit’ will spell the doom for the currency.  It is the opinion of some however, that were Greece to exit the Euro there is definite potential to strengthen the currency – other countries struggling would not default on their payments, and removing the weak link is not the worst thing that could happen to the Euro.  The developments with regards to the fate of Greece are undoubtedly going to be a major influence on the exchange rate euros in coming weeks.

Zhu remarked that the European crisis is a global problem as the effects are wide-reaching and felt by other economies – “we should not underestimate the negative impact from the European crisis to the whole world…  The growth side has a profound effect on the global economy.”

The effects of the European crisis have indeed made themselves felt in other economies.  For example Europe is responsible for purchasing one third of the Asian region’s value added exports.

Zhu’s comments came amidst remarks by a conservative politician in Germany – Mr. Dobrindt – which called for the exit of Greece from the Eurozone.  It is likely that Zhu’s remarks were made with the intent of calming the rising anger in some European countries that are aggrieved by bailouts given to Greece.

Zhu places extra emphasis upon the relationship that the euro shares with other economies when saying that “when the growth in the euro area drops to zero, you will see export growth from this region [the Chinese port city of Tianjin] drop to zero too.”

The exchange rate euros is hopefully set to improve with developments being made in the Eurozone.