PARIS, June 19: Bank of France governor Jean-Claude Trichet, in line to become the next head of the European Central Bank, said Thursday that despite market concern about the rise of the single European currency, the ECB was continuing to “pursue a policy for a strong and stable euro.”

Addressing a Finance Foundation Conference in Vienna broadcast by CNBC television, he said European integration was benefitting from the launch of euro.

But he added that financial stability remained one of the biggest challenges facing the 12-nation euro zone.

Trichet was acquitted by a Paris court Wednesday of false accounting charges and is now expected to replace Wim Duisenberg of the Netherlands at the head of the ECB.

He told the Vienna gathering that financial institutions had also to take steps to restore public confidence in financial markets in Europe and the United States.

It would be a mistake to say that financial instability is the price to pay for having sophisticated, integrated and inter-connected financial markets, he argued, referring to a position expressed in certain quarters.

Trichet said an increase in globalization and cross-border financial transactions meant that financial stability needed to be secured at an international level.

Governments should be aware that their domestic financial regulations can have an impact on other countries, Trichet maintained.

For this reason there should be a “sustained process of cooperation” between institutions and countries, he said. —AFP