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U.S. Treasury official: G20 sees need to 'double down' against devaluation

Published 09/05/2015, 07:11 AM
© Reuters. Finance and labour ministers gather for a group photo of the G20 Joint Meeting of Finance and Labour Ministers in Ankara

ANKARA (Reuters) - There is a shared belief among the members of the Group of 20 leading economies in the need to "double down" against competitive currency devaluation and avoid it in both policy and language, a senior U.S. Treasury official said on Saturday.

Speaking to reporters on the sidelines of the G20 meeting of central bankers and finance ministers in the Turkish capital Ankara, the official said the final communique from the meeting was expected to address competitive devaluation, where countries attempt to drive down a currency to boost exports.

"You can make policy decisions that lead to competitive devaluation, (or) you can say things that lead to talking down a currency," the official said.

"There is a shared sense that the G20 needs to double down on its principle that competitive devaluation is a bad thing."

Currencies have come into sharp focus at the G20 meeting, after China devalued the yuan in a surprise move in August, sparking market turmoil.

But Beijing appears to have learned about the importance of transparency in the communication of monetary policy from its latest market turmoil, the official said.

© Reuters. Finance and labour ministers gather for a group photo of the G20 Joint Meeting of Finance and Labour Ministers in Ankara

A draft of the communique obtained by Reuters on Friday showed that G20 members will likely to reiterate a promise to "refrain from competitive devaluations and resist all forms of protectionism".

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