The debate continues as experts give their counterarguments:
Bernard Connolly, executive director of AIG international.
Graham Bishop, advisor on European financial affairs at Salomon Smith Barney.
Supporters of Economic Monetary Union in Europe cannot ignore the fact that after much fanfare and predictions of rivalry with the US dollar, the euro still fell 13% against its rival over the first six months of its life. Euro weakness has been seized upon by euro-detractors as a sign of the impending failure of the EMU project. But this conclusion falls prey to a common confusion between a successful currency and a strong one. Seven months into its life, all the signs are that the euro has already been a success and is likely to be so in the future, despite early weakness on the foreign exchanges.
We can shed some light on the difference between success and strength in a currency through a cursory examination of the US dollar and the Japanese yen. The US dollar is a successful currency. It is the world's premier reserve currency and its guardian, Chairman of the Federal Reserve Board, Alan Greenspan, has won Euromoney's Central Banker of the Year award more often than any other.