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China assures as G20 mull policy options

Friday, February 26, 2016 - 01:33

Finance ministers and central bankers debate monetary policy stimulus and negative interest rates, as it looks unlikely any concrete action will emerge from the G20 meeting in Shanghai to tackle the sputtering global economy. Kirsty Basset reports.

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China's economy is showing positive signs - and there will not be another staged devaluation of the yuan - said China's Central Bank governor Zhou Xiaochuan at the G20 meeting in Shanghai. Soundbite (Chinese) Zhou Xiaochuan, Governor of People's Bank of China: "We would not want to participate in competitive currency depreciation in order to boost China's exports." He says China has room to move when it comes to monetary policy. But many other G20 policy makers may not. German Finance minister Wolfgang Schaeble says most at the meeting agree there is limited opportunity for additional monetary measures. And there are risks to consider too. Bank of England Governor Mark Carney spoke out against negative interest rates, warning they could leave the global economy trapped in low growth. Jan Randolph, from IHS Global Insight agrees the policy can be limited. Soundbite (English) IHS Global Insight's Director of Sovereign Risk, Jan Randolph saying: "I think if the global savings is moved as a whole out of cash balances into more productive uses like lending into the real economy then it is not a zero-sum game but what is true - is there is diminishing power, the more and more you use it." Finance ministers and central bankers have called for better policy coordination to tackle the sputtering global economy, but disagree about what steps to take, making it unlikely concrete action points will emerge from the gathering.

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China assures as G20 mull policy options

Friday, February 26, 2016 - 01:33