G-20 defuses talk of 'currency war,' no accord on debt

Japan's expansive policies, which have driven down the yen, escaped criticism in a statement agreed in Moscow by financial policymakers from the G-20, which groups developed and emerging markets and accounts for 90 percent of the world economy.

After late-night talks, finance ministers and central bankers agreed on wording closer than expected to a joint statement issued last Tuesday by the Group of Seven (G-7) rich nations backing market-determined exchange rates.

A draft communique seen by delegates on Friday had steered clear of the G-7's call for fiscal and monetary policy not to be targeted at exchange rates but the final version included a G-20 commitment to refrain from competitive devaluations and stated monetary policy would be directed at price stability and growth.

“The language has been strengthened since our discussions last night,” Canadian Finance Minister Jim Flaherty told reporters. “It's stronger than it was, but it was quite clear last night that everyone around the table wants to avoid any sort of currency disputes.”

The communique, seen by Reuters ahead of publication, did not single out Japan for aggressive monetary and fiscal policies that have seen the yen drop 20 percent.

The statement reflected a substantial, but not complete, endorsement of Tuesday's statement by the G-7 nations — the United States, Japan, Britain, Canada, France, Germany and Italy.

“We all agreed on the fact that we refuse to enter any currency war,” French Finance Minister Pierre Moscovici told reporters.

No Fiscal Targets

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