BERLIN (Reuters) - German Finance Minister Wolfgang Schaeuble said in a radio interview on Monday that the euro remains a stable currency and despite the euro zone debt crisis has held steady against the dollar in a consistent range.
He also said Germany’s economy remains strong and growth should reach 3 percent this year despite a recent softening.
“The euro remains stable,” he told Deutschlandfunk radio. “If you look at the foreign exchange developments you see that the markets indeed have confidence in the euro.
“The euro remained stable through all these months with all the turbulence, which are due above all to the debt crisis in the United States and due to the worsening perspective for the world economy. It has remained permanently in a range between 1.40 and 1.50 to the dollar,” he added.
Schaeuble also told Deutschlandfunk radio that the markets have confidence in the euro despite the sovereign debt crisis. He also pointed out that the debt levels in the United States are higher than in even the most critical eurozone countries.
“One should differentiate here. We’ve got debt problems some individual countries, not only in the euro zone. The United States have higher debts than even the most difficult countries in the euro zones. The general problem is that everywhere the public debt and public deficits are too high — also in Germany. We’re successfully reducing those in Germany.”
He said the financial market turbulence in recent weeks has been exaggerated and caught everyone by surprise. Germany’s economic fundamentals remain solid and the growth rate this year should reach 3 percent again, he said.
“Markets tend to exaggerate,” Schaeuble said. “A lot of people warned that the DAX was overvalued slightly in the first quarter this year. Now we’ve got a correction on the downside and that is presumably exaggerated. One needs strong nerves on the bourse and one shouldn’t go crazy over every movement.”
Schaeuble said the German economy is in strong shape.
“There are no indications of a recession,” he said. “We’ve got a slight softening of growth that’s actually been stronger this year than anyone expected. At the start of the year we expected growth of 2.5 percent.
“And then the forecasts went up month by month to over 3 percent. Now everyone is pointing toward Germany reaching 3 percent. So we’re still above what we expected at the start of the year. So there’s been a dampening of exaggerated expectations but there’s no sign of a recession.”
Reporting by Erik Kirschbaum; Editing by Ramya Venugopal