TREASURY'S BAKER SAYS HE STANDS BY PARIS PACT
Treasury Secretary James Baker said
he stood by the Paris agreement among leading industrial
nations to foster exchange rate stability around current
levels.
    "I would refer you to the Paris agreement which was a
recognition the currencies were within ranges broadly
consistent with economic fundamentals," Baker told The Cable
News Network in an interview.
    "We were quite satisfied with the agreement in Paris
otherwise we would not have been a party too it," he said.
    Baker also noted the nations agreed in the accord to
"co-operate to foster greater exchange rate stability around
those levels."
    He refused to comment directly on the current yen/dollar
rate but said flatly that foreign exchange markets recently
tended "to draw unwarranted inferences from what I say."
    Baker was quoted on British Television over the weekend as
saying he has no target for the U.S. currency, a statement that
triggered this week's renewed decline of the dollar.
    "I think the Paris agreement represents evidence that
international economic policy co-ordination is alive and well,"
Baker said.
    The Treasury Secretary stressed however it was very
important for the main surplus countries to grow as fast as
they could consistent with low inflation to resolve trade
imbalances.
    He added that Federal Reserve Board chairman Paul Volcker
has also "been very outspoken" in suggesting main trading
partners grow as fast as they can.
   
 Reuter
