BEIJING (MNI) - Exchange rate flexibility has its benefits but large-scale volatility in a currency's value can be harmful to the economy, People's Bank of China Vice-Governor Hu Xiaolian was reported as saying at the weekend.

Exchange rate flexibility can help promote balance in internal and external demand but that "speculative and herd-driven (flows) have a big impact on exchange rates," Hu said at a conference in Shanghai, according to a report carried by the National Business Daily, a Shanghai-based newspaper.

By John Shaw

WASHINGTON (MNI) - Especially in recent years, reading the Congressional Budget Office's annual long-term fiscal report has been a dispiriting, even depressing exercise.

By Yali N'Diaye

WASHINGTON (MNI) - Despite markets' revived concerns about the recovery, a Treasury Department official Friday expressed confidence the recovery really is proceeding as expected, dismissing the scenario of a double-dip recession.

A CORUNA, Spain (MNI) - The euro area cannot allow one of its member states to go bankrupt, European Central Bank Executive Board member Jose Manuel Gonzalez-Paramo said Friday.

"The euro cannot permit itself a default," Paramo told media at a press briefing before an engagement here. "The euro is our common destiny."

Asked if the bank stress tests lacked the credibility needed to calm the markets, Paramo replied, "I do not clearly see such a risk. Of course there can be some investor or some part of the market that maintains its doubts afterwards."

VIENNA (MNI) - The Eurozone is not in a currency crisis, but rather in a crisis of public finances, European Central Bank Executive Board member Juergen Stark reiterated Friday.

"I am not worried about the future of the euro," Stark said in a speech for delivery at a conference here. "The euro is and remains our common stable currency."

By Angelika Papamiltiadou

ATHENS (MNI) - Greece's Finance Minister George Papaconstantinou has revealed that public debt will rise by 4 to 5 percentage points of GDP because the government will assume the debt of heavily indebted public companies, as requested by the European Commission, the European Central Bank and the International Monetary Fund.

VIENNA (MNI) - The Eurozone is not in a currency crisis, but rather in a crisis of public finances, European Central Bank Executive Board member Juergen Stark reiterated Friday.

"I am not worried about the future of the euro," Stark said in a speech for delivery at a conference here. "The euro is and remains our common stable currency."

"It is not, as many commentators suggest, a crisis of the euro," he said. "The crisis results much more from a crisis of government finances and insufficient economic reforms in the Eurozone."

BERLIN (MNI) - German Economics Minister Rainer Bruederle on Friday said he does not see the risk of a double dip recession in Germany.

Asked by reporters if he feared that a possible slowing of growth in China and the US could bring the German recovery to a halt, Bruederle replied: "I don't see that danger and I also don't see the risk of a double dip."