Currency analysts still unsure of Greenspan

Press, 24 July 1987, Page 20

Currency analysts still unsure of Greenspan

NZPA-Reuter Frankfurt European currency analysts and dealers still have doubts on whether Alan Greenspan would, as he has assured senators in Washington, maintain Paul Volcker’s tough stand on inflation as new head of the U.S. central bank.

If he is to keep the dollar from slumping, rekindling U.S. inflation and slowing economic growth in the rest of the world, these are the people whose respect and trust Greenspan needs because of the huge volumes of money in which they deal daily.

“Greenspan said that he

would fight inflation, that he was happy with a stable dollar and that he was afraid of a dollar freefall... but he still has to be put to the test,” said Eckhart Hager, currency analyst at Chase Bank AG in Frankfurt.

“He has yet to prove that he can follow Volcker’s line. It is easily said but not so easily done,” said the chief foreign exchange dealer of another major U.S. bank in Frankfurt.

President Reagan nominated Greenspan in early June to succeed Volcker as chairman of the Federal Reserve Board. He has yet to obtain Senate confirmation in the job.