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Homeeurope newsAll Treasury Secretaries want a strong dollar: Ex-deputy

All Treasury Secretaries want a strong dollar: Ex-deputy

All Treasury Secretaries would prefer to have a strong dollar, but in the end it's the markets that get in the way, the former Deputy Secretary of the Treasury, Neal Wolin, has told CNBC.

Wolin, who held the deputy position between 2009 and 2013, said that while the U.S. would favor a stronger dollar, the imperative since the financial crisis has been to improve the economy and form a stable recovery.

"I think that you've seen Treasury Secretaries for many years now say – and clearly say – that they're for a stronger dollar but of course the market in the end will decide," he told CNBC. "It will matter what the relative strength and the relative positioning of the U.S. economy is with respect to the positioning of the dollar. But certainly from the U.S. perspective or the U.S. Treasury perspective, a strong dollar is the right place to be."

(Read more: Trade data lifts US dollar, Canadian dollar slides)

The U.S. currency has gradually weakened since the onset of the financial crisis in 2008, and the greenback has further deteriorated since the summer of 2013 after investors became nervous when the U.S. Federal Reserve initially mentioned winding down its bond-buying program. The euro was the strongest-performing major currency in 2013.

In a recent note from Wells Capital Management, analysts expect the dollar to weaken as the global economic recovery takes hold. "U.S. real GDP growth will likely rise above 3 percent this year and in isolation this would strengthen the U.S. dollar," Jim Paulsen, chief investment strategist and economist, wrote in a note.

(Read more: Contrarian call: US dollar to weaken further in 2014)

Former Deputy Treasury Secretary Neal WolinChip Somodevilla | Getty Images

"However, most other economies are also experiencing acceleration in their recoveries. And, in most cases, improvements in foreign growth rates are more dramatic and by comparison to the U.S., should lead to a weaker dollar."

Commenting on the dollar's weakness, Wolin said that those who thought the U.S. was not doing enough to support a strong dollar were confusing what the U.S. Treasury's preference was with what the markets had actually done to the greenback's value.

"There has been a real imperative to make sure the U.S. economy has recovered and has gotten to a better place, which I think is now something that has happened and the U.S. economy continues to be progressing along that road to recovery," Wolin said.

(Read more: Jack Lew to press Germany to boost domestic demand)

"But there's no question that Treasury Secretaries have said…they'd rather have a strong dollar.

"In the end, of course, markets will determine these levels; there's nothing that can be said other than that. But if the choice is between a strong dollar and not a strong dollar, it's clearly the former that Treasury Secretaries would prefer."

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