Nov. 18 (Bloomberg) — European officials, blaming U.S. deficits for a surge in the euro, are unlikely to persuade Treasury Secretary John Snow to help support the dollar when the Group of 20 finance ministers and central bankers meet in Berlin.

Snow, who meets his counterparts Nov. 19 to Nov. 21 in the German capital, yesterday criticized Europe for not doing enough to spur growth. European Union Monetary Affairs Commissioner Joaquin Almunia said Nov. 15 the U.S. “needs to adjust” its burgeoning current-account and budget deficits.

“Europeans may increase the shrillness of their tone, but they’re not going to say anything really new,” said Rajeev de Mello, who helps manage $7.4 billion in European bonds at Pictet & Cie. in Geneva and expects the euro to rise as high as $1.40 in three to six months. “A weaker dollar is part of U.S. policy.”

The euro has increased 7 percent against the dollar in the past two months, reaching a record $1.3047 on Nov. 17. The gains threaten to curb demand for European exports, the driver of the region’s recovery. Growth in the 12 nations sharing the currency slowed in the third quarter to the weakest pace in more than a year. The pace of expansion in the U.S. accelerated.

The shortfall in the U.S. current account, a measure of trade, services, tourism and investments, widened to a record $166.2 billion in the second quarter. The budget deficit grew to a record $413 billion in the fiscal year ended Sept. 30, or 3.6 percent of gross domestic product, the highest since 1993.

`Most Acrimonious’

“The G-20 meeting has the potential to be the most acrimonious since the G-7 meeting in the fall of 1987, when Germany rebuffed U.S. efforts to obtain support for a weakening dollar,” said Robert Sinche, chief currency strategist at Banc of America in New York, in a note to investors.

Concern about the dollar’s decline will probably overshadow other topics of discussion among G-20 officials. The G-20, founded five years ago, includes the Group of Seven industrialized nations plus the biggest emerging economies including China, Russia, Saudi Arabia, Turkey, Indonesia, South Korea and South Africa.

The nations account for 90 percent of the global economy, 80 percent of world trade and two thirds of its population.

The 44 percent increase in oil prices this year will also be discussed at the G-20 meeting, with non-producers urging nations such as Saudi Arabia to channel the income from oil into investment in additional production, German Finance Minister Hans Eichel told reporters in Brussels on Nov. 16. Ministers will probably welcome the 18 percent decline in the price of crude from the record $55.67 in New York reached on Oct. 25.

Japanese Concern

“Foreign exchange rates have moved considerably since the last meeting of the G-7 and there is no doubt that currencies will be one focus at the G-20 meeting,” Japanese Finance Minister Sadakazu Tanigaki told reporters in Tokyo on Nov. 16. “Rapid swings are no good for global economic growth.”

Japan, which sold a record 32.9 trillion yen ($310 billion) in the fiscal year ended March 31, hasn’t taken action to stem the yen’s increase against the dollar since March because officials were confident the economy had recovered from a decade of stop- start growth. Since then, Japan has reported two consecutive quarters of slowing economic expansion. The yen rose to a seven- month high of 105.17 against the dollar on Nov. 15.

The euro is bearing the brunt of the dollar’s two-year decline, gaining against the U.S. currency as well as the Japanese yen, Bloomberg data show. The deutsche mark, as a 30-year proxy for the euro, has strengthened against the yen and is close to the edge of its three-decade trading range.

ECB Inaction

European Central Bank President Jean-Claude Trichet, who will also attend the G-20 meeting, on Nov. 8 called the euro’s appreciation against the dollar “not welcome” and “brutal.” The ECB has shown no signs it will back up those words with action — by buying dollars or selling euros.

“At current euro-dollar levels, the risk of ECB intervention is almost non-existent as other central banks have so far remained silent with respect to the weakening of the U.S. dollar,” said Michael Klawitter, an economist at WestLB AG in Dusseldorf, Germany’s third-biggest state-owned bank.

Almunia said in an interview that “our friends across the Atlantic aren’t interested” in stopping the rise by selling or buying currencies on exchange markets.

“The history of efforts to impose non-market valuations on currencies is at best unrewarding and checkered,” Snow said in London on Nov. 18 in response to a question about whether he would advocate an agreement with Europeans to manage the pace of the dollar’s decline.

Dollar Policy

If George W. Bush finishes the final two months of his term without buying or selling dollars, he will be the first president not to intervene in currency markets since the end of the Bretton Woods agreement ushered in flexible exchange rates in 1973. That agreement fixed currency values to the price of gold.

“The U.S. position is that ultimately growth is the most important issue and that the rest of the world should be pursuing policies to spur faster growth,” said Richard Clarida, a former chief economist at the Treasury under Snow and now chief economic strategist at Clinton Group Inc. in New York.

Measured by the Fed’s Trade-Weighted Major Currency Dollar Index, the dollar has shed about a fifth since Bush took office in January 2001. Under Bill Clinton’s last two Treasury secretaries, Robert Rubin and Lawrence Summers, the index advanced 24 percent.

`Unlikely to Work’

The euro-region’s finance ministers on Monday declined to call on the ECB to sell euros to push the currency down. Dutch Finance Minister Gerrit Zalm, who chaired their meeting, said ministers “didn’t ask the ECB anything.”

“ECB intervention to weaken the euro is unlikely to work — and therefore unlikely to happen — without a cut in interest rates or international support,” Ian Stewart, an economist at Merrill Lynch & Co. in London, said in a note to investors.

Europe and the U.S. will probably maintain their differing views on the reasons behind the dollar’s slump. Current-account imbalances and budget deficits will be discussed and “questions will be put to the U.S,” German Deputy Finance Minister Caio Koch- Weser told reporters on Nov. 10.

Losing the $2 billion the U.S. attracts daily from central banks and overseas investors might create a “debt maelstrom,” Federal Reserve Chairman Alan Greenspan said in September. Greenspan will also attend the G-20. Fed Governor Edward Gramlich said Nov. 13 a growing deficit and dependence on foreign investors has created an “unstable” situation.

Under Germany’s chairmanship, the G-20 also seeks to promote institution-building in the financial sector and advance regional integration, expand procedures for the prevention of financial crises, reduce harmful tax competition and fight money laundering and terrorist financing.