STRASBOURG, France (Thomson Financial) - The European Parliament expressed concern over the appreciation of the euro but rejected calls for closer coordination of exchange rate policy by the European Central Bank and finance ministers.
The plenary session of the parliament voted in favour of a report from its economic and monetary affairs committee on the ECB with few amendments.
The report expressed "concern about the ongoing appreciation of the euro against most major foreign currencies".
But it said the euro's rise has so far not been harmful to exports.
And the plenary session deleted a section of the report which called for the euro group and ECB to "coordinate their actions in the field of exchange rate policy more closely".
A proposal to add a call for increased coordination of exchange rate policy in a separate report on the euro zone economy was also rejected.
The report on the ECB also said that the central bank should be cautious about further interest rate hikes.
"Any further raising of interest rates should be undertaken with caution in order not to endanger economic growth," it said.
Some 506 MEPs voted in favour of the report, with 64 voting against and 41 abstaining.
The separate report on the euro zone economy, which was also endorsed by the plenary session, said more tightening of fiscal policy would reduce pressure for higher ECB interest rates.
"More fiscal tightening would reduce pressure on monetary policy and allow for a better policy mix that would ensure faster economic growth under a given inflation rate".
steve.whitehouse@thomson.com
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