THE region's exporters were in bullish mood last night despite fears that trade with the US could be hit by a currency crisis.

The US dollar dropped to an 11-year low against the pound and hit an all-time low against the euro.

The Japanese yen was also left reeling as US trade deficits continued to widen.

The US is not the biggest export market for the North-East - Europe has dominated export activity for the region for the past three years.

However, the impact of the weakening dollar cannot be underestimated. A significant amount of business is carried out across the Atlantic, and in the quarter leading up to June last year - the most current figures available - the US was the most lucrative market for North-East exporters.

Companies in the region export a number of products, ranging from computer software, brand management services, film and media graphics, to training consultancy services and custom-designed motorcycle wallpaper and bedding.

John Williams, international trade director at UKT&I, is confident the region will suffer no lasting damage.

He said: "Currency risk is just one of the risks faced by exporters.

"The region's exporters have already shown they can match the best in the world in the face of declining currency among their competitors by increasing the region's exports all the way through the three years of decline in the value of the euro.

"This is despite the fact that Europe represents nearly 80 per cent of our export earnings for the region.

"I expect the region's businesses to continue their excellent achievements in spite of the dollar's decline."

Low interest rates and the threat of terrorist attack have contributed to the dollar's decline. President George Bush's administration appears unconcerned by the situation, probably because it increases the competitiveness of US goods abroad.

On Sunday, Federal Reserve governor Ben Bernanke said that the risk of a dollar crisis was "quite low".

In US morning trade yesterday, the dollar slumped to $1.2805 to the euro before recovering slightly, and at one point reached $1.8280 to the pound.