Europe was able to withstand the recent tempest on international markets thanks to the strength of the euro, Italian Premier Romano Prodi said here on Monday.
Speaking to the press in this Tuscan spa town, the former European Commission president observed that "it was certainly important that small European currencies joined together to create a mighty euro. I hope we have learned a lesson from this crisis".
The crisis on international markets was instigated by a crash crunch in the United States among the so-called subprime funds which grant high-interest mortgages and loans to high risk borrowers.
The crisis appears to have been brought under control by coordinated actions by central banks and, especially, by the US Federal Reserve cutting its discount rate last week to make more cash available on the market.
Looking back at the crisis, Prodi praised the collaboration between the Fed and the European Central Bank and added "I hope the crisis is indeed over. But one never knows. We need to keep our eyes open and, above all, apply the lesson we have learned".
"And this includes a better monitoring of financial markets," he added.
According to the premier, "rating companies were created to make preventive controls and they should get back doing this job".
Rating agencies like Moody's have come under sharp criticism for giving subprime funds a higher rating than they deserved.
German Chancellor Angela Merkel has also criticised rating agencies and called for greater transparency on financial markets.
In an interview published Sunday in Bild am Sonntag, Merkel, who currently chair the Group of Seven (G7) most industrialised countries, said "rating agencies should be put in the dock. In the future it must be clear on what basis they make the evaluations. They can no longer be a black box which issues information which no one can understand".
In related developments, the European commissioner for economic and monetary affairs, Joaquin Almunia, said on Monday that while a calm appears to have settled on international markets it was still too soon to evaluate the effect the recent crisis will have on European economies.
