Official comments after the G7 meeting
WASHINGTON (Reuters) - Finance ministers and central bankers from the top industrialized countries met on Friday to discuss the global credit crisis.
They issued a communique after their half-day meeting at about 6 p.m.
Following are highlights from their comments after the Group of Seven meeting.
ON FOREIGN EXCHANGE
U.S. Treasury Secretary Henry Paulson
"I reiterated, in very strong terms, our commitment to a strong dollar."
"Our long-term fundamentals are solid and they're going to be reflected in currency values."
"I do believe it is the view of all of the ministers sitting around the table that...we're all better off if exchange rates reflect economic fundamentals. I don't think any of us believe that China is ready at this time to have a market-determined exchange rate. But we do believe to have them continue to make progress.
"If you look at the appreciation of the renminbi you have seen it accelerate over the last three or four months... They're making progress, and that was noted and appreciated by people around the table."
ECB President Jean-Claude Trichet
"I personally never comment on these discussions, it's a very touchy issue."
Asked what people should make of the G7 forex wording, he replied that "it's like a poem, it speaks for itself"
ON INTEREST RATES:
ECB President Jean-Claude Trichet
"Four percent contributes to price stability in the medium-term," Trichet said during an explanation of how the ECB was working on two separate fronts -- one which was monetary policy proper and the other which was liquidity operations to help markets function properly.
Asked if G7 forex statement resulted from tacit accord that ECB would cut rates, he said certainly not.
ON FINANCIAL MARKET TURMOIL
U.S. Treasury Secretary Henry Paulson
"We have been undergoing a period of financial market stress since last August. Markets are pricing and reassessing risk and there are always difficulties during periods such as this. There may be more bumps in the road. As we work through this period, our highest priority is limiting its impact on the real economy."
European Central Bank Governing Council member and Bundesbank President Axel Weber
"There are some first, encouraging signs that the major part of corrections is behind us...there are one or the other lights on the horizon."
"But you never can rule out a setback."
"The total amount of losses for the year 2007 and first quarter of 2008 sums up to about 225 billion dollars."
"Germany has to take around 30 billion."
"That means Germany has a share of around 10 percent of that," which makes Germany number three behind the US and Switzerland, Weber said.
Weber said there were are some "horror-numbers" in the room which are much higher.
German Finance Minster Peer Steinbrueck
Steinbrueck says of high estimates of losses from the financial crisis: "Numbers like that can cause a lot of fear with the people."
ON U.S. ECONOMY
U.S. Treasury Secretary Henry Paulson
"I am confident in the long-term economic prospects of the United States, However, the housing correction, together with high energy prices and financial market turmoil, are weighing on U.S. economic growth. Given the significant short-term downside risks, we are taking action."
ON COORDINATED EFFORTS TO ADDRESS MARKET UNREST
U.S. Treasury Secretary Henry Paulson
"International cooperation and coordination has been excellent. We have worked and will continue to work, closely to address global challenges and take concrete actions. ... The (President's Working Group) is working closely with foreign regulators, finance ministries, and central banks through the Financial Stability Forum) on financial market issues. Working together, we can strengthen market discipline, enhance risk management, ad improve the efficiency and stability of our capital markets."
ECB President Jean-Claude Trichet
"We also said that within 100 days firms should strengthen their risk management practices and stress testing"
((Washington newsroom; +1-202-898-8489)
