News Column

G20 Chiefs Focus on U.S. Debt Deal, Sustainable Growth

October 11, 2013

Japan Economic Newswire

g20
G-20 working session in New York (photo: G20)

WASHINGTON, Oct. 11 -- Finance chiefs from the G-20 economies started their second day of talks Friday in Washington, with their joint statement after the two-day meeting expected to call for the U.S. central bank's clarification of policy stance at the time of anticipated monetary easing unwinding.

The statement is likely to also highlight a need for member countries to coordinate actions for a sustainable growth of their respective economies as the U.S. Federal Reserve's scaling down of its quantitative easing could cause investors to start flocking out of emerging economies, conference sources said.

Global repercussions of the U.S. debt ceiling impasse, which has overshadowed the meeting, may also be referred to in the communique as potential threats to global financial system stability by the financial chiefs from the leading economies that include top holders of U.S. Treasuries, they said.

The finance ministers and central bank governors from the G-20 economies gathered as U.S. President Barack Obama and leading Republicans showed signs of avoiding an unprecedented default in the world's largest economy.

The U.S. government partially shut down after the divided Congress failed to pass a budget by the Oct. 1 start of fiscal 2014. The legislature has also failed to agree to raise the limit on the amount the government can borrow beyond Oct. 17.

John Boehner, speaker of the Republican-dominated House of Representatives, proposed increasing the limit of government borrowing for six weeks so the government will be able to pay bills.

Obama, Boehner and other Republican leaders failed to strike a deal on the proposal but will keep dialogue Friday.

During the first-day session, Japanese Finance Minister Taro Aso called on the United States to settle the debt ceiling problem without delay.

Many other participants shared similar concerns about the U.S. fiscal impasse, Aso suggested.

The G-20 meeting came as the financial markets are closely watching when the U.S. Federal Reserve decides to taper its quantitative easing through an asset purchase program.

Emerging economies are concerned that the Fed's scaling down of the asset buying program could trigger further capital outflows from their countries and thwart their growth.

The G-20 groups Argentina, Australia, Brazil, Britain, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, the United States and the European Union.

(c) 2013 Kyodo News International, Inc.

Original headline: G-20 finance chiefs begin 2nd-day session, focus on U.S. prospects


For more stories on investments and markets, please see HispanicBusiness' Finance Channel



Source: (c) 2013 Kyodo News International, Inc.


Story Tools






HispanicBusiness.com Facebook Linkedin Twitter RSS Feed Email Alerts & Newsletters