BRUSSELS — Seven major developed countries including the United States and Germany pledged on Tuesday to let foreign exchange markets determine the value of their currencies.
The statement by the Group of 7 prompted relief in Japan, where policy makers have been under fire from some officials in Europe and the United States who say they are unfairly seeking to give their economy a shot in the arm by bringing down the value of the yen.
The statement “properly recognizes that steps we are taking to beat deflation are not aimed at influencing currency markets,” said Taro Aso, the Japanese finance minister.
In a statement, the G-7 powers said they would consult closely to avoid moves that could hurt stability. But they restated a commitment to market-determined exchange rates.
“We reaffirm that our fiscal and monetary policies have been and will remain oriented towards meeting our respective domestic objectives using domestic instruments, and that we will not target exchange rates,” the G-7 said in the statement, which was posted on the Web site of the Bank of England.
Concerns had been mounting in recent weeks about the effects of an ultraloose monetary policy in Japan that has pushed the yen lower against major currencies. The yen’s weakness also had prompted talk of a so-called currency war if other parts of the world followed suit in a competitive devaluation.
The euro’s rise in value has become a particular concern in the euro zone, since it could make exports more expensive and dent growth if demand for European products falls. Those concerns had prompted France to call for some kind of exchange-rate policy.
On Monday, Pierre Moscovici, the French finance minister, said he wanted the Europeans to present a common plan later this week during a meeting of finance ministers and central bankers of the Group of 20 nations to be held in Moscow.
But the head of the German Bundesbank, Jens Weidmann, said Monday that the French initiative was a poor substitute for policy overhauls that, if implemented, would do more for growth.
On Tuesday in Brussels, following a regular monthly meeting of E.U. finance ministers, Wolfgang Schäuble, the German finance minister, said there was “no foreign exchange problem in Europe” and that such issues should be discussed at the G-20 meeting in Moscow.
Group of 7 Says It Will Let Market Decide Currency Values
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Group of 7 Says It Will Let Market Decide Currency Values
