China, Japan, South Korea commit to economic policies supporting demand

Sun May 3, 2015 4:02am EDT
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BAKU (Reuters) - Central bankers and finance ministers from China, Japan and South Korea said on Sunday they remained committed to policies to support demand in the face of moderate and uneven global growth.

The policymakers for the three North Asian economies held a trialateral meeting, chaired by Japan's Deputy Prime Minister and Finance Minister Taro Aso, on the sidelines of an Asian Development Bank Meeting in Baku, Azerbaijan.

Their joint statement noted that global economy was passing through an uncertain phase, and growth remained moderate and was following divergent paths.

"We are committed to continue implementing timely and effective macroeconomic policies in order to help boost demand," the statement said.

"Structural reforms to increase potential growth should continue to remain a high priority for a sustainable and balanced growth."

The statement also urged a caution in monetary policy.

"In an uncertain environment of global economy, monetary policy settings should be carefully calibrated and clearly communicated to minimize negative spillovers," it said.

Many economists have warned that expected interest rate hikes by the U.S. Federal Reserve at a time when many other central banks continue to pursue loose monetary policies could cause volatility in capital flows and exchange rates.

"When dealing with possible macroeconomic and financial stability risks arising from volatile capital flows, the necessary macroeconomic policy adjustments could be supported by macro-prudential policies," the statement said.   Continued...

Japan's Finance Minister and Deputy Prime Minister Taro Aso makes remarks during a news conference, in Washington, April 17, 2015. Aso is in Washington to attend the IMF and World Bank's 2015 Annual Spring Meetings. REUTERS/Mike Theiler