The European Central Bank (ECB) has told Eurogroup finance ministers it sees room to cut interest rates when necessary, the French finance minister said this morning.
Mr Francis Mer's comments came after the ministers, with the backing of the ECB, responded to the euro's steep rise against the dollar by declaring that a strong and stable euro was in the interest of the regional and global economies.
Speaking to reporters in Brussels before all 25 present and future EU finance ministers began a meeting, Mr Mer said the 12 Eurogroup ministers had discussed interest rates with ECB officials over dinner yesterday evening.
"The ECB took note of our views on that and clearly indicated that there was monetary room for manoeuvre," he said.
ECB Vice-President, Mr Lucas Papademos made clear that the room to cut rates would be used "if and when it becomes necessary", the French minister said.
The ECB was spared the public tongue-lashing expected at the Eurogroup meeting for its decision last Thursday to keep interest rates steady at 2.50 per cent.