No Change in Currency Policy of Strong Dollar

Paul Onil, the U.S. minister of Treasury department stated on the first that he has no mind to change existing currency policy that maintains strong dollar.

Minister Onil attended the U.S. senate hearing of Financial Commission and said, “exchange rate can be controlled by free market the most and, even if government has mind to interfere, it is hard to control foreign exchange market”.

Such speech of minister Onil has come amid the U.S. labor field and financial world pressure that dollar should be weakened in order to reinforce competitive power regarding exporting of U.S. goods.

Paul Savanes, Chairman of Financial Commission said in the hearing, “China and Japan interfered in exchange market steadily for years in order not to raise their currency value, in spite of recording huge benefits of trade” and, “we need similar means like `plaza agreement` in order to normalize dollar value”.

G-7 had arranged plaza agreement, in which they interfered in exchange market collectively in order to degrade dollar value in 1985 on the demand of the U.S.

Fred Bergstein, the head of IIE (International Institute of Economy) insisted, saying “whenever dollar rises 1 percent, the U.S. trade deficit rises at least 10 billion dollars” and “ currently dollar is highly evaluated up to 20~25 percent ”.

However minister Onil said, “ the U.S. economy is recovering and it will effect world economy market in latter part of this year ” and, “I can`t give satisfactory answer to those who expect that current strong dollar policy would change”.