SHANGHAI (Reuters) - U.S. Treasury Secretary Jack Lew on Friday urged countries to avoid competitive devaluation and said it was increasingly important to use all available policy tools to address a shortfall in global demand.
Lew was speaking to reporters on the sidelines of a G20 meeting of central bankers and finance ministers being held in Shanghai.
“It is increasingly important to use all the levers of policy that are available, and that means using fiscal levers as well as monetary policy and structural reforms,” he said.
“(There’s a) need to avoid competitive devaluation, that’s competing in a beggar-thy-neighbor way for sharing a pie that’s either frozen or shrinking and it doesn’t lead anywhere good.”
Lew said he believed China had the necessary policy tools to accomplish its economic transition, but that it needed to stick to its reform agenda and communicate policies, especially those on its exchange rate, clearly.
He also said that the U.S. economy was doing “quite well”, with strong job creation and private sector growth, and consumer demand remaining strong.
Reporting by Brenda Goh and Adam Jourdan; Editing by Jason Subler; Editing by Sam Holmes