ECB can live with current euro rate

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There is no reason to worry about the euro currency's retreat from high exchange rates against the dollar, European Central Bank (ECB) Governing Council member Ewald Nowotny was quoted as saying on Sunday.

"There is certainly no need to worry," Nowotny told Austrian daily Oesterreich when asked about the stability of the common European currency. "The exchange rate to the US dollar has always changed sharply since the euro existed."

"The current rate is still in the upper region. For the broader economy, it's even positive that the euro has retreated from its previous overvaluation," he said.

"Everybody can live well with this rate."

Nowotny said Austria's financial stability had improved since the economic crisis abated in emerging Europe, where Austrian banks have a large exposure, but bad debt charges would continue to rise "significantly" next year.

He also said he hoped planned European Union regulation of hedge funds could be agreed upon before summer.

"This is absolutely necessary," he said. "I hope there will be a concrete agreement before the summer, especially to introduce more transparency and some minimum standards."