MOSCOW (Reuters) - Group of Seven nations will adhere to their currency statement released earlier this week and stronger members of the euro zone should do more to increase demand, U.S. Treasury official Lael Brainard said on Friday.
“G20 members will have to bring their exchange rate frameworks into alignment so that we grow together and avoid a downward spiral or beggar-thy-neighbor policies,” Brainard told a banking conference on the sidelines of a G20 finance officials’ meeting in Moscow.
The G7 issued a joint statement on Tuesday reaffirming “our longstanding commitment to market determined exchange rates”. Yet the show of unity was quickly undermined by off-the-record briefings critical of Japan.
Brainard went on to tell CNBC that all members of the G7 would adhere to the statement and should “avoid loose talk on currencies”.
At successive G20 meetings, Germany has pressed the United States and others to do more to tackle their debts. Washington in turn has urged Berlin to do more to increase demand.
“It’s very important to calibrate the pace of fiscal consolidation,” Brainard said. “It’s ... important to see demand in the euro area and some of that must take place through internal rebalancing.”
Reporting by Lesley Wroughton, writing by Mike Peacock