G7 to Address Currency War this week

The Group of Seven nations are considering a statement this week reaffirming their commitment to “market-determined” exchange rates in response to heating rhetoric about a currency war, G20 officials said on Monday.

The language, which could be subject to change, implies that the major powers would not indulge in unilateral currency devaluation and reads very similarly to the last statement issued by the G7 on currencies in 2011.

“It focuses on a commitment to market-determined exchange rates and (governments) not using policies to drive currencies,” one official said.

Two officials from different countries told Reuters that if agreed, the statement could be released around the time G20 finance ministers and central bankers meet in Moscow on Friday and Saturday.

U.S. and European officials have expressed concern about comments from Japanese officials that they are targeting a specific level for the yen. Japan’s new government has pressed for aggressively expansionary monetary policies, which have prompted the yen to weaken sharply.

via Reuters

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.