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Paulson not rule out intervention to stabilize dollar

(Xinhua)
Updated: 2008-06-10 10:51

WASHINGTON  -- US Treasury Secretary Henry Paulson said Monday that he would not rule out the possibility of intervening to stabilize the US dollar.

"I would never take intervention off the table or any policy tool off the table," said Paulson in an interview on CNBC business television channel. "I just can't speculate about what we will or won't do."

He was asked about a possible currency intervention to help prop up the dollar.

The dollar rebounded somewhat Monday afternoon against the euro on Paulson's comments.

For most of the past seven years, the dollar has been sliding in value and the weakening pace has quickened since last August, as the US economy is slowing down significantly and the Federal Reserve keeps lowering interest rates.

The Bush administration has refused to intervene in currency markets, insisting currency levels should be set by free-market forces.

The weakening dollar helps promote exports by making US products cheaper to overseas buyers. However, it also increases inflationary pressures.

Acknowledging that surging world oil prices are a "problem," Paulson said the 168-billion-dollar economic stimulus package should help Americans offset rising energy prices.

He expressed confidence in the long term performance of the US economy.

Its strong long-term fundamentals are going to shine through and provide support for the dollar, he said.