By Marcin Grajewski
BRUSSELS, June 4 (Reuters) - Europe's top business group defended the European Central Bank's response to the economic crisis on Thursday from criticism by German Chancellor Angela Merkel.
BusinessEurope, which groups 20 million European companies, also voiced concern about a rise in the euro against the dollar and other currencies, saying it may harm exports.
Merkel issued rare public criticism of central banks including the ECB on Tuesday, questioning their decision to pursue non-standard steps to fight the crisis and urging a return to "reason" in monetary policy.
But BusinessEurope said the ECB should do even more to fight the worst recession since World War Two.
"Politicians ... should refrain from commenting on the ECB, which should be doing more. (The central bank's) political independence is very important," BusinessEurope chief Marc Stocker told a news briefing.
He said that apart from its 60 billion euro ($85 billion) programme to buy covered bonds to support bank lending, the ECB should also buy corporate bonds.
Despite signs of improvement, European companies continued to be choked by a lack of credit, which was forcing them to wind down operations, he added.
On exchange rates, BusinessEurope said the euro had passed the "threshold of pain" for European firms when it recently strengthened above $1.40, but its current level could be manageable as long as the currency did not appreciate further.
At 0815 GMT the euro was up 0.5 percent on the day at $1.4227, approaching technical resistance at the 100-week moving average of $1.4243, Reuters charts showed.
The euro hit $1.4337 in early trade on Wednesday, its strongest since December.
"The trend is worrying, continued appreciation would be a headache for exporters. We need to make sure the euro does not ... strengthen further," Stocker said.
He added BusinessEurope was also worried by the weakness of the British pound, which harmed Irish exports, and by unstable currencies in some east and central European countries.