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Sarkozy Seeks Discussion On Euro Exchange Rate With ECB: Report

4/18/2012 4:27 AM ET

French President Nicolas Sarkozy said on Wednesday that the euro's exchange rate against the dollar must be discussed with the European Central Bank, reports said citing a television interview.

Sarkozy, who is seeking a second presidential term, told the local television channel BFM TV that euro is too expensive and a stronger euro hurts exporters as they would be less competitive. "These are debates that we must have with the ECB Governor," he reportedly said.

Calls for a cheaper euro are common during French election campaigns, observers said, citing past instances. France's main exports include aircraft and luxury goods.

However, Germany is against putting pressure on the ECB to boost growth. Sarkozy's call for ECB intervention is against a November agreement with Germany that they will not discuss the central bank's role publicly.

Any exchange rate intervention is against ECB's mandate, which is to maintain price stability. France's conservative president has said that he is not trying to alter the central bank's mandate.

Earlier this week, Sarkozy said the ECB must support growth and that such a stance would not threaten the central bank's independence. He said on France Inter Radio On Tuesday that it is wrong to say that because the ECB is independent, others do not have the right to talk.

The first round of French presidential elections are scheduled for April 22. Sarkozy's Socialist opponent Francois Hollande is presently leading the presidential race, according to opinion polls. The second round runoff is due for May 6.

Hollande wants to renegotiate the EU fiscal pact signed in March to include provisions for promoting economic growth.

by RTT Staff Writer

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