U.S. President George W. Bush said on Wednesday it was up to the markets to decide the value of the dollar against the euro and added that a new rate hike by the Federal Reserve was an indication of concern about the weak dollar. "We believe that the markets should make the decision about the relationship between the dollar and the euro," Bush told reporters at the end of a meeting with Italian Prime Minister Silvio Berlusconi. Bush said the recent Federal Reserve rate hike was "a signal to world markets that the chairman (Fed Chairman Alan Greenspan) is also aware of the relative currency valuations between the euro and the dollar." Bush said Berlusconi raised the issue in their Oval Office talks. Bush said he pledged to take up the issue with the U.S. Congress in terms of reducing the U.S. budget deficit and reforming the Social Security system. "He expressed his concerns about the relationship between the dollar and the euro. I told him that we're going to take this issue seriously with the Congress. The best thing we can do from the Executive Branch of government in America is to work with Congress to deal with our deficits," he said. Bush cited the short-term budget deficit and the "unfunded liabilities" of the Social Security system as problems that needed to be dealt with. He said he hoped a push on deficit reduction would "send a signal" to markets that the United States is committed to a strong dollar.
