UPDATE 1-EU unions seek forex guidelines for ECB

(Adds socialist MEPs comments, background)

By Jan Strupczewski

LUXEMBOURG, Oct 8 (Reuters) - European Union trade unions, backed by socialist members of the European Parliament, joined European businesses on Monday to call for action from finance ministers and the ECB to curb the strength of the euro currency.

The European Trade Union Confederation (ETUC) urged EU finance ministers in a statement to issue policy guidelines for the European Central Bank to help curb the rise of the euro.

In a separate statement the European Parliament's socialists, the second biggest parliamentary caucus, warned that the euro's strength, coupled with the global credit crunch, would hit growth and required concerted action by governments.

These statements follow a plea for help with the euro to Jean-Claude Juncker, who chairs meetings of euro zone finance ministers and the ECB, from European businesses last week.

Pervenche Beres, who chairs the European Parliament's economic and monetary affairs committee, called for unity on the issue, which has seen euro zone countries divided on how serious the impact of the strong currency really was.

ECB President Jean-Claude Trichet will testify before the parliamentary committee on Tuesday.

"The central bank, euro zone ministers and the Council need to coordinate their actions on exchange rate policy more closely," Beres said. "It is more than urgent that they learn how to speak with one voice on a subject that is of common interest."

The euro hit record highs against the dollar a week ago when it traded at $1.4281 on market expectations of further rate cuts in the United States and stable or higher rates in the 13 countries using the euro.

But the dollar has firmed since then to trade at around $1.4050 to the euro at 1547 GMT. U.S. jobs data suggested the economic slowdown the world's biggest economy might be less dramatic than previously expected.

"The European Trade Union Confederation today reminds the European Commission and EU finance ministers that they have a responsibility to avoid brutal swings in the euro exchange rate," the unions said in a statement.

The confederation also urged the ministers to discuss the issue with finance ministers and central bankers of the United States, Canada, Japan and Britain at the next Group of Seven meeting in Washington later this month.

Despite such complaints, Peer Steinbrueck, the finance minister of Europe's biggest exporter Germany, told reporters before the ministers' meeting that he "loved the strong euro".

But ETUC Deputy General Secretary Reiner Hoffmann said politicians should not downplay the euro's strength in the hope that wage moderation will help keep exporters competitive.

"This approach would perhaps save European exports but it will certainly kill domestic demand and abort the recovery. Instead, the Commission and the Ecofin Council need to act to provide the ECB with a clear framework of exchange rate policies," he said.