Mario Draghi said Monday that « the recent volatility in the exchange rate represents a source of uncertainty which requires monitoring. »
FRANKFURT, Germany — European Central Bank head Mario Draghi has underlined his concern about the recent rise in the euro’s exchange rate.
Draghi said Monday that « the recent volatility in the exchange rate represents a source of uncertainty which requires monitoring. »
The euro has risen from $1.05 at the start of the year to around $1.19. A further increase could weigh on exports from the eurozone and restrain its ongoing economic recovery. Draghi had also expressed concern about the euro at his Sept. 7 news conference.
Draghi told the European Parliament’s economic and monetary affairs committee that the current economic recovery was « firm and broad-based. » The ECB is expected to outline at its Oct. 26 meeting how it will start phasing out its bond-buying stimulus, currently worth 60 billion euros ($71 billion) a month.
Draghi repeated his stance from the Sept. 7 meeting by saying that « the bulk of these decisions are going to be taken at the next meeting in October. »
Speculation that the stimulus would be withdrawn has helped drive the euro higher, since stimulus measures tend to weigh on a currency’s exchange rate. The ECB has been cautious about signaling a rapid exit from the stimulus, instead stressing that support would be gradually withdrawn as the economy continues to improve. The euro’s appreciation appears to have taken a breather, with the currency holding around or just under $1.20 in recent days.
