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Euro debuts in Asia, Down Under with little fanfare

The Euro, the new common currency that is expected to increase Europe's economic power and eventually rival the US dollar on world markets, enjoyed a quiet debut in international trading in Australia and Asia today.

The day's first dealings in the Euro had been expected to be cautious and subdued, and that was clearly the case in Sydney, where electronic trading began at the ungodly hour of 5 am local time, and in other markets such as Japan and Hong Kong.

It was still dark in the financial district of Sydney when trading started between banks via brokers, but lights could be seen from some of their offices in the skyscrapers.

At the Westpac Bank foreign exchange trading room, there was a hum of activity from traders and media taking pictures and television footage of the opening of trade in Euro.

In general, trading in Euro was light and uneventful.

"People are just having a small punt so they can say they dealt in Euro,'' said Wayne Raven, a senior manager of Westpac's corporate, currency and commodity division.

In Tokyo and Hong Kong, where Euro trading also began early, Yasuhisa Morikuni, a Bank of America executive, said: "It has been quiet so far. We haven't seen any surprises this morning.''

The infant currency was launched at midnight Thursday in Europe, following the announcement of official fixed conversion rates for Euro against the 11 participating European currencies.

For example, the rates made Euro worth 1.95583 German marks, 6.55957 French francs, 1936.27 Italian lire and 166.386 Spanish pesetas. Today, the Euro was expected to start trading around the world at 132.80 Japanese yen, 1.89 Australian dollars, 70 British pence, and 1.16675 US dollars.

Several hours after trading began in Sydney, the Euro was quoted by buyers and sellers at US $ 1.1747 and at 133.17 yen.

In general, Asian institutions were buying the new currency and European ones were selling it, dealers said.

In Tokyo, the Euro was trading at US $ 1.1755, dealers said.

Australia was the first major financial market to trade the Euro since the 11 european currencies merged to form it. However, the currency did trade lightly in Bombay, India, on Friday, where markets opened in spite of the new year's holiday.

The European nations that launched the Euro represent 20 per cent of world economic output and 18 per cent of world trade, and they will make a powerful player in the world economy.

In fact, one goal of the currency is for it to help the European Union forge a common market that is able to stand its ground against the United States and Asia.

For the first time in decades, the US dollar will have a rival as the currency of choice for world trade and government reserves, a real change in Asia, where it has long been dominant.

While trading in the Euro began today, the first business day since new year's, Euro bills and coins will not be introduced until January 2002.

Euro trading was expected to get off to a slow start in Asia and later in the day in Europe and New York with few players apart from the big international banks taking positions.

It also could take weeks for large institutional investors to be confident enough to start taking large positions in the market.

UNI

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