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Merkel rejects Trump advisor euro claim Merkel rejects Trump advisor euro claim
(35 minutes later)
The German Chancellor has rejected comments made by a Trump advisor that Germany uses an undervalued euro to exploit trading partners.The German Chancellor has rejected comments made by a Trump advisor that Germany uses an undervalued euro to exploit trading partners.
Peter Navarro, the head of Mr Trump's National Trade Council, told the Financial Times that the euro is a German currency in disguise. Peter Navarro, the head of Mr Trump's National Trade Council, told the Financial Times that the euro is a German currency in disguise.
But Mrs Merkel said Germany "has always called for the European Central Bank to pursue an independent policy".But Mrs Merkel said Germany "has always called for the European Central Bank to pursue an independent policy".
She added that Germany "will not influence the behaviour of the ECB".She added that Germany "will not influence the behaviour of the ECB".
Mr Navarro told the Financial Times that talks over the Transatlantic Trade and Investment Partnership (TTIP) between the EU and the US were dead. Mr Navarro also told the Financial Times that talks over the Transatlantic Trade and Investment Partnership (TTIP) between the EU and the US were dead.
"A big obstacle to viewing TTIP as a bilateral deal is Germany, which continues to exploit other countries in the EU as well as the US with an 'implicit Deutsche Mark' that is grossly undervalued," he told the Financial Times."A big obstacle to viewing TTIP as a bilateral deal is Germany, which continues to exploit other countries in the EU as well as the US with an 'implicit Deutsche Mark' that is grossly undervalued," he told the Financial Times.
He added that there was a "structural imbalance" in trade.He added that there was a "structural imbalance" in trade.
Bloomberg News said the euro is trading "well below its fair value" according to OECD measures.
A low currency makes goods cheaper to sell abroad. The US regularly tells China its currency is too cheap and gives its products an advantage in world markets.
Those who argue the euro is undervalued often blame the ECB's monetary policy, including trillions of euros of asset purchases, aimed at stimulating inflation and growth in the eurozone, parts of which, notably Greece, are economically weak and need support.
The ECB, like the Bank of England and the US Federal Reserve, is independent.
'Independent''Independent'
Germany's trade surplus powers a large chunk of its economy. Germany - which is the biggest economy in the 19-country bloc - differs from much of the rest by selling far more goods abroad than it imports - giving it a large trade surplus.
According to official figures from Destatis, in November 2016 Germany exported goods worth 108.5bn euros and imported goods to the value of 85.8bn euros - the highest monthly figures ever calculated both for exports and imports.According to official figures from Destatis, in November 2016 Germany exported goods worth 108.5bn euros and imported goods to the value of 85.8bn euros - the highest monthly figures ever calculated both for exports and imports.
In response to Mr Navarro's comments, Mrs Merkel said: ""Germany is a country that has always called for the European Central Bank to pursue an independent policy, just as the Bundesbank did that before the euro existed."In response to Mr Navarro's comments, Mrs Merkel said: ""Germany is a country that has always called for the European Central Bank to pursue an independent policy, just as the Bundesbank did that before the euro existed."
"Because of that we will not influence the behaviour of the ECB. And as a result, I cannot and do not want to change the situation as it is," she added."Because of that we will not influence the behaviour of the ECB. And as a result, I cannot and do not want to change the situation as it is," she added.
Mr Trump has made trade one of the central planks of a proposed radical overhaul of the way the US interacts with the rest of the world.Mr Trump has made trade one of the central planks of a proposed radical overhaul of the way the US interacts with the rest of the world.
He has outlined a number of protectionist trade policies with the stated intention of creating more US jobs, including threatening to scrap a number of existing free trade agreements.He has outlined a number of protectionist trade policies with the stated intention of creating more US jobs, including threatening to scrap a number of existing free trade agreements.
He has suggested withdrawing the US from the World Trade Organization, and in his first week on the job scrapped the Trans-Pacific Partnership.He has suggested withdrawing the US from the World Trade Organization, and in his first week on the job scrapped the Trans-Pacific Partnership.
China has also been singled out, and Mr Navarro has been a fierce critic of China.China has also been singled out, and Mr Navarro has been a fierce critic of China.