EMU: NO PANIC OVER FALLING VALUE OF EURO.

The Euro made a sharp recovery on the foreign exchange markets on December 6. Having started the day by falling again, this time to below parity with the Dollar, the European currency then picked up rapidly following the publication of good German economic indicators. The rise in the single currency benefited both Sterling and the Swiss Franc but penalised the Yen, which fell sharply against major currencies. Since its launch on January 1, 1999, the single currency has dropped by more than 15%. Despite this fall, Euro-zone Ministers of Finance and the President of the European Central Bank have always insisted that the European currency had a definite potential for appreciation. The net upturn in economic growth forecasts in the Euro zone for the year 2000 (see figures published in European Report No 2454) should add to upward pressures on the Euro.Putting a positive spin on recent developments, the Commission President's spokesman suggested that the fall in value of the Euro will help European exports and employment. Currencies rise and fall, he added, blaming...