Rising Euro is a Concern: EU's Barroso

The strength of the euro, at a record high versus the dollar, is becoming a problem for Europe's exporters, the president of the European Commission said on Thursday.


"It's true that the very strong euro is becoming a concern to some export sectors in some parts of the European economy," Jose Manuel Barroso told Reuters in an interview on the sidelines of an EU summit with Southeast Asian countries in Singapore.

In an interview with CNBC, Barroso said German exports were "booming" despite the single currency's strength, and exports to the United States were also strong.

"But it's true that we are concerned about the imbalance that we are now seeing between some currencies globally," Barroso told CNBC.

He added that China had "acknowledged the seriousness of the trade imbalance" and had "promised to do something about that."

"I hope that our Chinese partners will consider the issue very seriously," Barroso said.

Additional Risks

The dollar hit a record low against the euro and a basket of currencies on Thursday as expectations of a further U.S. Federal Reserve interest rate cut were reinforced by the Fed's projection that U.S. economic growth would slow next year.

The euro hit a record high of $1.4873.

Economists said the strong euro would dent European growth next year and the European Central Bank also pointed this week to additional risks from higher oil, commodity and food prices.

Barroso was in Singapore to discuss a free trade agreement (FTA) with Southeast Asian nations, though European concerns over a crackdown on protesters in military-ruled Myanmar may prove a stumbling block, with little progress since talks started in May.

"I cannot commit myself to a precise date," said Barroso. "We are ready and very much willing to conclude a FTA -- we believe all countries will be involved in negotiations."

The Association of South East Asian Nations is the EU's fifth-largest trading partner.

Barroso is heading to Beijing next week for a summit with China. He said the trade deficit between the EU and China was unsustainable and that he expected the two sides would address this at the summit.