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To: lorne who wrote (30307)	3/18/1999 9:20:00 PM
From: goldsnow	Read Replies (1) \| Respond to of 116795

that huge surplus and rising oil, should give Strong Dollar lot of pause one would think in weeks to come....never mind Asia recover rumor :)

To: lorne who wrote (30307)	3/19/1999 7:30:00 PM
From: goldsnow	Respond to of 116795

Why Euro rates were not cut Edith Cresson: Her demise may well contributed to the rate decision Caught between a rock and a hard place, the European Central Bank (ECB) decision not to cut rates is perhaps understandable. The BBC's Rodney Smith reports: With France the only eurozone economy showing any sign of buoyancy, the decision is almost certainly merely delaying a rate cut next month. But not making a move now could be the act of experienced and conservative bankers in the face of potentially serious market instability. The euro, on the other hand, is not within the Bank's frame of reference. It does not have an official currency target. So the ECB could not have been thinking of the euro when it decided to leave rates alone, although it is the most palpable casualty of the loss of the European Commission en masse. The Bank need not worry, if ever it did. Credibility in the euro rests with the behaviour of member governments, not the European Commission. While the credibility of European institutions has taken a knock, the euro could eventually benefit from the apparent confirmation that Europe is capable, eventually, of a kind of transparency. The result is that many bankers are now factoring into their calculations a euro rate at around $1.08. If it goes much below this, though, the credibility of both currency and bank could come to be seriously tested. It could be below this level (and remembering the euro's starting point at the beginning of the year - a shade over $1.16) that foreign holders think seriously of moving into dollars or yen. A fall of a cent or two would be unlikely to turn into a rout, but one seller does tend to inspire another. Which would be a pity, because the events of the past week have done nothing to change the underlying eurozone economy. That is prey to other strengths and weaknesses, little changed now from what they were when the euro was at $1.10 or $1.12. news.bbc.co.uk