The CFA franc s fixed exchange rate is pegged to the euro and overvalued in order to shield French companies from euro depreciation.

The sharp depreciation of the euro after the crisis helped sustain German exports, thereby keeping the eurozone afloat.

This could and should be accompanied by an overall depreciation of the euro, though that would be no panacea.

That is why I believe that these countries and the eurozone more generally would benefit from euro depreciation.

WASHINGTON, DC Over the last several weeks, the dollar s depreciation against the euro and yen has grabbed global attention.

The real depreciation necessary to restore external balance would drive the real value of euro debts even higher, making them even more unsustainable.

The balance sheet effects on euro debts caused by the depreciation of the new national currency would thus have to be handled through an orderly and negotiated conversion of euro liabilities into the new national currencies.

In any case, protecting exports by resisting euro appreciation or, more precisely, dollar depreciation is a poor way to promote economic growth.

Or a weaker euro could be had if the ECB were willing quite unlikely to ease monetary policy further to allow real depreciation.

The nominal increase translated into a significant decline of actual resources available, primarily due to the impact of the depreciation of Usthe United States dollar against the secretariat's functional currency, the Euro.

Due to the depreciation of the US United States dollar against the Euro, anticipated actual expenditures required to maintain the current structure of the secretariat are expected to exceed the approved budget.

Its purpose is not to encourage the depreciation of the yen, despite complaints about the yen s depreciation.

China s Daring Depreciation

But, even if exchange rates work in mysterious ways, their cushioning effect is undeniable. The sharp depreciation of the euro after the crisis helped sustain German exports, thereby keeping the eurozone afloat.

But eurozone membership deprives these countries of this powerful tool, and depreciation of the euro itself is of limited benefit since so much of their trade (around 50 ) is with Germany and other eurozone members.

Given the depreciation of the United States dollar against the euro over the past two years, the near zero growth in euro terms leads, in United States dollar terms, to a nominal increase of 22.0 per cent at the time of preparation of this budget proposal (see paragraph 10 above).

And that means further depreciation of the dollar.

The extent of creditor countries losses would depend on the extent of the depreciation, giving them an interest in keeping the depreciation within bounds.

Restoring sustained growth requires real currency depreciation.

Dollar depreciation improves Europe s terms of trade and real income.

Indeed, given that depreciation is a key tool for engineering a fast economic recovery, why not invite Greece to leave the eurozone? After all, by staying in the euro, a rapid export led recovery would be impossible.

But all of the options that might restore competitiveness require real currency depreciation.

In principle, such a depreciation against all of the world s currencies is manageable.

Depreciation is used to record the declining value of buildings and equipment over time.

So we expect a substantial depreciation premium on US interest rates.

The depreciation expenses have gone up to 2.02 million against the budgeted amount of 0.9 million. The circumstances under which the depreciation expenses increased by 100 percent could not be satisfactorily explained to the Panel.

Similarly, the Euro VIX, a popular measure of expectations of euro volatility, has fallen significantly.

The depreciation that followed the crisis helped accelerate recovery by boosting exports.

First, it contributes to yen depreciation and dollar appreciation as carry traders switch out of yen.

Depreciation is computed using the straight line method over the estimated useful life of the asset.

Simply put, there must be dollar depreciation to keep global imbalances in check.

A 20 dollar depreciation would therefore reduce Americans purchasing power by only 3 .

B. Introduction of the euro

Corporate retained earnings have averaged about 3 of GDP after allowing for depreciation of existing plant and equipment.

But, in the absence of complementary action, depreciation whether engineered or market driven will make matters worse.

For example, there could be a Greek euro, a Spanish euro, etc.

To maintain growth, they need a nominal and real depreciation of their currency to reduce their trade deficits.

In fact, Brazilians purchasing power could shrink further, owing to the depreciation of the real against the dollar.

Chile made its transition to high growth in the 1980 s on the back of a large depreciation.

When the bubble bursts, the afflicted country can restore competitiveness only through a painful process of real depreciation.

The Perilous Politics of the Euro

The Global Roots of Euro Jitters

Third, the position of the euro will strengthen over time as more countries will join the euro zone.

With China retaining its under valued currency policy, dollar depreciation can aggravate global deflationary forces.

The attempt to achieve them is bound to lead to competitive currency depreciation and protectionism.