sunshine05
5th November 2010, 06:31 AM
GLOBAL ECONOMY-China, Germany belittle U.S. actions before G20
Fri Nov 5, 2010 9:15am EDT
* China tells U.S. trade targets smack of central planning
* German finance minister says Fed policy "clueless"
* Merkel to address U.S. money policy at G20 summit
* ASEAN concerned about U.S. current account proposal
* Emerging economic powers keep up criticism
(Adds German government source on Merkel)
By Zhou Xin and Annika Breidthardt
BEIJING/BERLIN, Japan, Nov 5 (Reuters) - China rebuffed on Friday a U.S. plan to set limits for trade imbalances and Germany dubbed the Fed's money-printing policy "clueless", setting the stage for what could be a fractious G20 summit next week.
Washington believes an undervalued yuan is a major cause of economic imbalances and has pressed Beijing, largely in vain, to let the currency rise more swiftly to reflect the strength of what is now the world's second-largest economy.
The waters of the debate have been muddied by the Federal Reserve's decision to buy $600 billion in long-term bonds with new money in an effort to revive the flagging U.S. economy.
Resentment is rumbling worldwide that the initiative will generate even more instability by ramping up currencies against the dollar, inflating asset bubbles and increasing inflation. "With all due respect, U.S. policy is clueless," German Finance Minister Wolfgang Schaeuble told a conference.
"(The problem) is not a shortage of liquidity. It's not that the Americans haven't pumped enough liquidity into the market, and now to say let's pump more into the market is not going to solve their problems."
German Chancellor Angela Merkel will address U.S. policy in Group of 20 discussions on exchange rates, a government source said, adding that she shared Schaeuble's criticism.
Policymakers from the world's new economic powerhouses in Latin America and Asia have said they would consider fresh steps to curb capital inflows after the Fed's move. [ID:nTOE6A300V]
Zhou Xiaochuan, China's central bank governor, said while Beijing could understand that the Fed was implementing more monetary easing in order to stimulate U.S. recovery, it may not be a good policy for the global economy. [ID:nBGN5ME61T]
http://www.reuters.com/article/idUSTOE6A403Y20101105
Fri Nov 5, 2010 9:15am EDT
* China tells U.S. trade targets smack of central planning
* German finance minister says Fed policy "clueless"
* Merkel to address U.S. money policy at G20 summit
* ASEAN concerned about U.S. current account proposal
* Emerging economic powers keep up criticism
(Adds German government source on Merkel)
By Zhou Xin and Annika Breidthardt
BEIJING/BERLIN, Japan, Nov 5 (Reuters) - China rebuffed on Friday a U.S. plan to set limits for trade imbalances and Germany dubbed the Fed's money-printing policy "clueless", setting the stage for what could be a fractious G20 summit next week.
Washington believes an undervalued yuan is a major cause of economic imbalances and has pressed Beijing, largely in vain, to let the currency rise more swiftly to reflect the strength of what is now the world's second-largest economy.
The waters of the debate have been muddied by the Federal Reserve's decision to buy $600 billion in long-term bonds with new money in an effort to revive the flagging U.S. economy.
Resentment is rumbling worldwide that the initiative will generate even more instability by ramping up currencies against the dollar, inflating asset bubbles and increasing inflation. "With all due respect, U.S. policy is clueless," German Finance Minister Wolfgang Schaeuble told a conference.
"(The problem) is not a shortage of liquidity. It's not that the Americans haven't pumped enough liquidity into the market, and now to say let's pump more into the market is not going to solve their problems."
German Chancellor Angela Merkel will address U.S. policy in Group of 20 discussions on exchange rates, a government source said, adding that she shared Schaeuble's criticism.
Policymakers from the world's new economic powerhouses in Latin America and Asia have said they would consider fresh steps to curb capital inflows after the Fed's move. [ID:nTOE6A300V]
Zhou Xiaochuan, China's central bank governor, said while Beijing could understand that the Fed was implementing more monetary easing in order to stimulate U.S. recovery, it may not be a good policy for the global economy. [ID:nBGN5ME61T]
http://www.reuters.com/article/idUSTOE6A403Y20101105