Friedrich Merz, Chancellor of Germany, amplified growing apprehension within the nation's economic circles regarding the sustained weakness of the U.S. dollar, which has recently touched multi-year lows against the Euro. Speaking ahead of critical coalition meetings in Berlin, Merz explicitly framed the exchange rate movement as a material impediment to German export performance.
Merz’s assessment was immediately echoed by Dirk Jandura, President of the BGA (German Foreign Trade Association). Jandura highlighted that the corresponding strength of the Euro directly inflates the cost of German goods on international markets, intensifying competitiveness challenges. For the vast network of mid-sized exporters, often lacking the hedging capabilities of multinational giants, this volatility represents a 'serious risk' due to narrow profit margins.
Germany’s economy, heavily reliant on foreign trade, has demonstrated fragility, having barely avoided recession in recent periods while facing intensified competition, notably from China. The current currency realignment compounds these existing headwinds, making the path to sustainable growth more precarious for key industrial sectors.
In a notable divergence from European concerns, U.S. President Donald Trump recently dismissed commentary on the dollar's level, describing its valuation as 'great,' even as the exchange rate dipped past the 1.20 per Euro mark. This contrasting official stance underscores a transatlantic divergence in immediate currency priorities.
In response to this structural vulnerability, Merz and Finance Minister Lars Klingbeil advocated for accelerated progress on creating a digital Euro. The strategic initiative, they argue, is essential not only for modernizing finance but also for consolidating the Euro’s standing as a leading global reserve currency, thereby structurally reducing Germany’s dependence on the dollar’s fluctuations.
This push for digital currency integration reflects a broader strategic objective: to enhance the Eurozone's financial autonomy and shield its core export engine from external monetary policy volatility. The outcome of these internal policy discussions will significantly shape Germany's trade strategy for the coming fiscal year. (Source: Based on reporting by Reuters and other international outlets.)