IMF calms currency row

09:15, October 11, 2010      

Email | Print | Subscribe | Comments | Forum 

The world's top finance officials wrapped up three days of talks in Washington Sunday after failing to reach a consensus on measures to head off what some see as a looming currency war.

The International Monetary Fund steering committee, which has been struggling to address friction among key economies, including China and the United States, said Saturday that the organization should continue its study.

"While the international monetary system has proved resilient, tensions and vulnerabilities remain as a result of widening global imbalances, continued volatile capital flows, exchange rate movements and issues related to the supply and accumulation of official reserves," the IMF panel said in a statement after its meeting Saturday. "We call on the Fund to deepen its work in these areas, including in-depth studies to help increase the effectiveness of policies to manage capital flows."

The statement from the International Monetary and Financial Committee, the policy arm of the IMF, stopped short of any specific call on China or others to change policies of using a low currency and accumulation of reserves to boost exports.

IMF Managing Director Dominique Strauss-Kahn, when asked about the lack of a stronger statement, said, "There is only one obstacle, and that is an agreement of the members."

The final communique appeared to be a setback for the United States. It had urged the IMF to be a tougher cop on exchange rate policies, a position echoed by a number of Europeans and other officials.

Japanese Finance Minister Yoshihiko Noda told the panel earlier that "it is not sustainable that certain countries achieve growth while imposing costs on other countries."

China's top central banker, Zhou Xiaochuan, on Friday rejected demands for a quick yuan revaluation, declaring that the emerging giant would reform gradually rather than engage in "shock therapy."

Other participants at the IMF downplayed the notion of a currency war.

"I don't think there is a war," French Finance Minister Christine Lagarde said. "In a war, there is always a loser, and we cannot have a loser."

Meanwhile, European Central Bank chief Jean-Claude Trichet said he saw reason for optimism.

"I have full confidence that the international community will find the appropriate ways to cooperate," Trichet said at the close of talks.

Trichet also minimized the rift between the emerging and developed economies over currency, saying a consensus had been expressed and adopted by the Group of 20, including China, in June.

He said participants understood that "we have a shared responsibility" to avoid excessive exchange rate volatility or imbalances.

Source: Global Times


  • Do you have anything to say?


Special Coverage
  • Premier Wen Jiabao visits Hungary, Britain, Germany
  • From drought to floods
Major headlines
Editor's Pick
  • Chinese Navy soldiers hold an evening party marking the upcoming 62nd National Day aboard Chinese Navy hospital ship "Peace Ark" in the Pacific on Sept. 28, 2011. The Chinese National Day falls on Oct. 1. (Xinhua/Zha Chunming)
  • Photo taken on Sept. 30, 2011 shows the crowd at the plaza of Beijing Railway Station in Beijing, capital of China. The railway transportation witnessed a travel peak with the approach of the seven-day National Day holidays on Friday. (Xinhua)
  • A man wearing high-heel shoes takes part in the 3rd annual Walk a Mile in Her Shoes, an event when men literally walk in women's shoes to raise awareness about ending violence against women, at Yonge-Dundas Square in Toronto, Canada, Sept. 29, 2011. (Xinhua/Zou Zheng)
  • Photo taken on Sept. 29, 2011 shows a cargo ship in danger on the sea near Zhuhai City, south China's Guangdong Province. Cargo ship Fangzhou 6 of Qingzhou of southwest China's Guangxi Zhuang Autonomous Region lost control after water stormed into its cabin due to Typhoon Nesat on the sea near Zhuhai Thursday, leaving 12 crew members in danger. Rescuers rushed to the ship and saved them by using a helicopter. (Xinhua)
  • Actress Gong Li poses for L'Officiel Magazine. (Xinhua Photo)
  • Demonstrators from the Occupy Wall Street campaign hold placards as they march in the financial district of New York September 29, 2011. After hundreds of protesters were denied access to some areas outside the New York Stock Exchange on September 17, demonstrators set up a rag-tag camp three blocks away. Zuccotti Park is a campground festooned with placards and anti-Wall Street slogans. The group is adding complaints of excessive police force against protesters and police treatment of ethnic minorities and Muslims to its grievances list, which includes bank bailouts, foreclosures and high unemployment. (Xinhua/Reuters Photo)
Hot Forum Discussion