Klaus Regling said in comments printed in Germany’s Bild newspaper Thursday that while the euro could slip in value, the problems afflicting its weakest members are not putting the common currency in jeopardy.
“There’s zero danger,” he says. “No country will voluntarily give up the euro — for weaker countries that would be economic suicide, likewise for the stronger countries.” He says he agrees with Chancellor Angela Merkel, however, that Europe is in a “a very serious situation regarding the euro.” The Foreign Ministers of France and Germany expressed confidence that their nations would be able to provide swift assistance for Ireland, as they did earlier this year for Greece.
They said that Dublin’s latest austerity measures would help shore up confidence in the euro. At the same time, they warned that the European Union needs better policies to pre-empt other countries from spiraling into crisis, alongside mechanisms to intervene once a crisis occurs.
French Foreign Minister Michele Alliot-Marie said Europe is facing a “speculative attack” against the euro “in which those countries that could appear weak in the eyes of speculators are put under pressure.” Alliot-Marie underlined the importance of intervening quickly in markets to prevent further destabilization and underlined the need for a permanent set of regulations, such as those to take effect in the EU in 2013.
“Now we want to reinforce these regulations to have a crisis mechanism that allows us not only to react, but to prevent these speculative attacks,” Alliot-Marie said.
Her German counterpart, Guido Westerwelle, warned that market speculation only poses a danger when the fundamentals of a country’s finances are weak.
“The best protection against speculation is solid budgetary policy at home,” Westerwelle said.