Anton Börner, head of Germany’s BGA organization, said that German exporters can “live without the euroâ€. BGA represents mostly small and medium sizes companies. Börner’s alternative for the current euro framework is a bloc of the richer euro-zone countries.
This statement is quite surprising. The Deutschmark would be of a much higher value if it weren’t for the euro. Until 2005, Germany was considered to be “the sick man of Europeâ€.
Börner is aware of the competitiveness problem, but still says that it can be overcome. His main point about “no need for the euro is this:
“What is important for us is the free market, we do not necessarily need a common currency,†he told the foreign press association in Berlin. “Is there life for Germany after the euro? Yes there is.†Exporters “can live without the euro,†he added.
EUR/USD is diving today on the free fall of Italian bonds. It is currently trading between 1.36 and 1.3650. Italian bond yields are above 7%, and there are rumors that the ECB might finally gear up its efforts to lower Italian yields.
This could into a full scale QE operation, and further weaken the common currency.
H/T Â Jean-Pierre Chevallier for this news.
