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Italy fears euro could hit $1.60, hurting exports

Published 10/21/2009, 01:20 PM
Updated 10/21/2009, 01:24 PM

ROME, Oct 21 (Reuters) - The euro's appreciation above $1.50 is already "bad news" for Italy's exports and there are expectations it could rise to $1.60, the government official responsible for trade said on Wednesday.

Speaking after the euro-dollar rate rose above $1.50 for the first time in 14 months, Adolfo Urso, deputy industry minister in charge of trade, said the latest euro high represented a new threat to Italy's exports which are already taking a beating.

"The break through $1.50 is bad news and a source of worry for our exports towards the United States, our main market outside the European Union, and also towards China, as the yuan is tied to the fluctuations and weakness of the dollar," Urso said in a statement.

"It is something that prompts great concern ... because some analysts expect that the the weakness of the dollar will continue and reach the critical threshold of $1.60 to the euro."

Urso said a combination of the global economic crisis and the euro's appreciation by 20 percent versus the dollar since the start of this year had caused a fall in Italian exports to the United States of 24.9 percent between January and August.

National statistics institute ISTAT will issue September trade data on Thursday.

(Editing by Ron Askew)

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