SWISS COMMITTED TO JOINT CURRENCY INTERVENTION
The Swiss National Bank will continue to
take part in concerted intervention on currency markets as
necessary, president Pierre Languetin told the bank's annual
meeting.
    He said the dollar had on occasion hit highs or lows which
bore no relation to economic fundamentals and cooperation
between all monetary authorities was necessary to prevent it
breaching thresholds that would damage everyone.
    "We are resolved -- as we have done in the past -- to take
part in concerted intervention to the extent that this is
possible and desirable," Languetin said.
    Languetin said Switzerland had noted with satisfaction the
six nation Paris accord on currency stabilisation measures in
February, adding that it had anchored the principle of
strengthened international cooperation.
    He said measures such as recent concerted intervention were
useful in the short term.
    But he added, "The (Paris) Louvre accord can produce no
lasting effects without a correction of the fundamental
imbalances, without a reduction of the American budget deficit
and without stronger growth in Europe and Japan."
    Languetin said certain changes would probably be necessary
in the "too expansive" monetary policy of the United States,
adding that there was a prevailing view that U.S. Money supply
was expanding too strongly.
    "If this should last long the dollar could only be
stabilised at the cost of a substantial easing in monetary
policy on the part of the other central banks, which would in
turn create the basis for a new wave of world-wide inflation,"
he said. One positive factor was that monetary authorities in
the most important countries had not relinquished their
anti-inflation policies.
 REUTER
