Given the international importance of the new currency, it is not surprising that the development of the euro exchange rate has attracted considerable attention despite the fact that the level of the exchange rate is less important for the euro area as a whole than it was for each of the participating countries before the start of EMU, in particular for a small country like Belgium.
For this reason the level of the euro exchange rate is not in itself a precise policy objective of the Eurosystem. Nevertheless it is an important indicator in its monetary policy strategy. In the first part of the year the relative weakness of economic activity in the euro area compared with the high growth in the US has affected the euro exchange rate.