ECB’s Müller: Euro Strength Has Not Hurt Euro Area Exports

25 July 2025

By David Barwick – FRANKFURT (Econostream) – The appreciation of the euro has not held back euro area exports, according to European Central Bank Governing Council member Madis Müller on Friday.

In a blog post on the website of Eesti Pank, which he heads, Müller said it was ‘interesting to note that the euro exchange rate, which has appreciated significantly over the past six months, has not had a negative impact on euro area exports.’

There was some frontloading being driven by the expectation of possible tariffs, but exporters were more and more optimistic, he said. The normal tendency of a stronger currency to dampen exports ‘may currently be partially limited because, hand in hand with the appreciation of the euro, the so-called import component included in the production of euro area companies has become relatively cheaper’, he said.

Müller endorsed leaving interest rates unchanged for now in the interest of determining the possible need to readjust them ‘based on data in the coming months and quarters.’

His assessment of the current situation, he said, was that ‘the euro area economy is gradually recovering, price increases are very close to the European Central Bank's 2% target, both in the latest data and in the forecast, and interest rates are already likely to provide moderate support for economic growth.’

Global growth estimates were somewhat better than they had been a few months back, he said, and 1Q growth in key regions, including the euro area, had beaten expectations.

‘Trade restrictions and the associated uncertainty will undoubtedly slow down the economy, but they are expected to do so less than feared, at least in the near term’, he said.