Nov. 8 (Bloomberg) -- German Chancellor Angela Merkel is ``preoccupied'' by turbulence in the financial markets and is likely to raise the matter in talks with President George W. Bush at his Texas ranch tomorrow, a government adviser said.

``You can be absolutely certain that not just the finance minister but also the chancellor and the foreign minister are pretty preoccupied by the situation in the financial markets,'' Karsten Voigt, the German Foreign Ministry's coordinator for U.S. relations, said in a telephone interview in Berlin today.

Merkel may use her two-day visit to the Bush family ranch in Crawford, Texas, to revive Germany's calls for greater transparency in financial markets, Voigt said. ``Cooperation'' between the U.S. and Europe in this sphere ``is absolutely necessary,'' he said.

Merkel has used Germany's presidency this year of the Group of Eight leading industrial nations to press for greater transparency on hedge funds, and has also backed calls for a probe into rating-company assessments. While those calls yielded little at the G-8 summit in Germany in June, Finance Minister Peer Steinbrueck said Sept. 4 the subprime mortgage crisis had ``vindicated'' German efforts on transparency.

Merkel, unlike French President Nicolas Sarkozy, will probably not directly address the euro's record rise against the dollar during what will be her sixth visit to the U.S. since becoming chancellor in November 2005, Voigt said.

``I am personally not convinced Merkel will raise the question of the euro's exchange rate,'' he said, adding that Germany's position ``has been clear'' all along. ``This isn't an issue where, with regard to the question of currency relations, politics should seek an immediate influence.''

`Economic War'

That contrasts with Sarkozy, who told the U.S. congress yesterday that the Bush administration must stem the dollar's plunge or risk an ``economic war.''

Europe's single currency has climbed 11 percent versus the dollar this year, reaching a record $1.4731 yesterday, the highest since the 13-nation currency started trading in January 1999. It was worth as much as $1.4679 in Frankfurt today.

Germany and the European Union ``should do everything possible to make more leeway for assessment of the financial markets,'' Merkel said in a speech in Berlin on Oct. 23. Otherwise, Germany, as Europe's biggest economy, will ``again and again run the risk of footing the bill for risks others have taken.''

Two days later, the government downgraded its forecast for German economic growth in 2008 to 2 percent from 2.4 percent, citing the financial-market turmoil, slowing global growth and the euro's record rise against the dollar.

Bernanke Meeting

Merkel raised greater financial-market transparency with U.S. Federal Reserve Chairman Ben S. Bernanke during a meeting in Berlin on Sept. 11. U.S. lawmakers are pressing U.S. Treasury Secretary Henry Paulson for action as well. While Paulson cautions against rushing regulation, he has said there ``should be and will be changes.''

Besides what Voigt called ``crisis topics'' in financial markets, Merkel and Bush will discuss international issues including Iran's nuclear program, the war in Afghanistan, prospects for peace in the Middle East and the future status of Kosovo, Merkel's spokesman Ulrich Wilhelm told reporters Nov. 2.

To contact the reporter on this story: Andreas Cremer in Berlin at acremer@bloomberg.net.

Last Updated: November 8, 2007 07:29 EST