Former U.S. central bank chief Alan Greenspan said Wednesday that global economic imbalances might improve if some high-growth economies allowed their currencies to strengthen. "World equilibrium is probably better reached by allowing a number of these countries, which are showing extraordinary economic growth and really in many cases twice the growth of the developed nations, and allow currencies to firm," the former U.S. Federal Reserve chairman said in an address to a conference in the South Korean capital sponsored by the Financial Times newspaper. Greenspan spoke by satellite from the United States. He didn't specify the economies by name, but was responding to a question about the accumulation of vast amounts of foreign reserves by Asian countries including China, Japan and South Korea. "I realize what that does to competitiveness, but that's the way markets work efficiently," Greenspan said. "In other words, to prevent the exchange rates from moving creates all sorts of distortions." Greenspan, who led the Federal Reserve from 1987 until his retirement early this year, presided over an era of low inflation, low unemployment and the longest economic expansion in U.S. history -- a decade of uninterrupted growth from March 1991 to March 2001. He also steered the U.S. economy through the turbulence of the October 1987 stock market decline, the Mexican and Asian financial crises, and the aftermath of the 2001 terrorist attacks. Greenspan, however, said he doubted the economies of Asia could formally agree on ways to work together to allow their currencies to strengthen in tandem. "My judgment would be it's very difficult to get an agreement between a number of major countries who have their own domestic political adjustments to make and find that there is a single adjustment on which all could agree," he said. Persistent worries over growing U.S. budget and current account deficits have led some in Washington to call for U.S. trade partners including China to allow their currencies to strengthen against the dollar. That could cause their products to become more expensive in the U.S. while making American goods cheaper in their markets, thus helping reduce the trade balance. China, the world's fastest growing major economy, has racked up growth rates of more than 9 percent for years and expanded 9.9 percent last year. Last year's budget deficit came to $319 billion, an improvement from 2004 but still the third largest deficit ever recorded. This year, the White House is projecting the deficit to swell to $423 billion, which would set a record in dollar terms. The Commerce Department said last month that the current account -- the country's broadest measure of international trade -- surged to an all-time high of $804.9 billion last year. Greenspan also said that there is a significant amount of liquidity worldwide, but added that the situation isn't permanent and asset prices will eventually fall. He also said he regretted using the term "irrational exuberance" in a 1996 speech that led to a big one-day sell-off on Wall Street. "I'm sorry I used that term," Greenspan said. "It's one which does suggest a froth in the market place. I would hesitate to use it in today's context."