G20 eyes faster economic reforms as cheap credit not enough for growth
By Randall Palmer and Nick Tattersall
ANKARA (Reuters) - Financial leaders from the world's 20 biggest economies agreed on Saturday to step up reform efforts to boost disappointingly slow growth, saying reliance on ultra-low interest rates would not be enough to accelerate economic expansion.
But they also said they were confident growth would pick up and, as a result, interest rates in "some advanced economies" -- code for the United States -- would have to rise.
"Monetary policies will continue to support economic activity consistent with central banks' mandates, but monetary policy alone cannot lead to balanced growth," the communique of the G20 finance ministers and central bankers said.
"We note that in line with the improving economic outlook, monetary policy tightening is more likely in some advanced economies."
The wording defied pressure from emerging markets to brand an expected U.S. rate rise as a risk to growth.
"We heard different opinions on the possible Fed decision. Some think the Fed needs to make a decision sooner rather than later, while others think it should delay," Turkish Deputy Prime Minister Cevdet Yilmaz told a news conference.
To limit the volatility of capital flows from emerging economies into dollars -- the reason for concern about a future Federal Reserve hike -- G20 financial leaders said they would avoid any surprise or excessive moves.
"We will carefully calibrate and clearly communicate our actions, especially against the backdrop of major monetary and other policy decisions, to minimize negative spillovers, mitigate uncertainty and promote transparency," they said. Continued...