Question

What policy remedies, if any, are available to EU countries with overly strong Euro?

Answer 1

Following policy measures can be taken by EU countries with overly strong Euro:

1) European central bank can reduce interest rates which will reduce demand of Euro denominated assets resulting in lower demand of Euro, so value of Euro should decline.

2) European Central Bank might buy other currencies by selling EURO which will increase demand of other currencies and result in higher supplies of EURO, thus value of EURO will decline.

The above is the answer