G7 vows to back financial stability
2011-08-08 15:00:03
Financial chiefs and central bankers of the G7 nations early Monday pledged to "take all necessary measures to support financial stability and growth" as nervous global markets re-opened.
"We are committed to taking coordinated action where needed, to ensuring liquidity, and to supporting financial market functioning, financial stability and economic growth," a statement said as Asian markets reopened lower after a tumultuous weekend.
"We are committed to addressing the tensions stemming from the current challenges on our fiscal deficits, debt and growth, and welcome the decisive actions taken in the US and Europe," it said.
"The US has adopted reforms that will deliver substantial deficit reduction over the medium term.
"In Europe, the Euro area Summit decided on July 21 a comprehensive package to tackle the situation in Greece and other countries facing financial tensions," the statement added.
The financial chiefs and central bankers agreed to cooperate against excessive currency moves, Finance Minster Yoshihiko Noda said earlier to reporters before Asian markets reopened.
Noda also said officials of the Group of Seven -- Britain, Canada, France, Germany, Japan, Italy and the United States -- also talked about European economic issues amid worries over eurozone sovereign debts.
The dollar was changing hands at 78.34 yen in early Asian trade, compared with rates below 77.00 yen last week before Tokyo stepped into markets to stem its currency's strength to safeguard its exports.
The euro bought $1.4314.
Noda said excessive foreign exchange movements are undesirable but declined to comment on whether Japan had gained understanding from other economic powers on its yen-selling intervention.
Meanwhile, the European Central Bank said it would make major purchases of eurozone bonds in the latest move to stem a debt crisis that has world leaders scrambling for a global response.
The ECB said it would "actively" renew the bond purchases after Italy and Spain announced new measures and reforms to boost their economies and France and Germany pushed for full and rapid implementation of terms agreed at an emergency summit last month.
To add to the turmoil, Standard & Poor's cut the US rating to AA+ from the top notch triple-A for the first time.
Washington has been split over how to reduce its more than $14 trillion debt without further hobbling the sluggish economic recovery, and its limited debt deal came after a bruising partisan battle.