UPDATE 4-G20 says economy recovering but no end to crisis yet

Fri Sep 6, 2013 11:24am EDT
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* "Difficult talks" on economy at G20

* Emerging market turmoil a focus

* Communique reflects improvement in developed world

* Federal Reserve policy shift looms large

By Lidia Kelly and Luke Baker

ST. PETERSBURG, Russia, Sept 6 (Reuters) - The Group of 20 powers said on Friday the world economy was improving but it was too early to declare an end to crisis with emerging markets facing increasing volatility.

The prospect that the Federal Reserve may rein in its expansive monetary policies as soon as this month has plunged into turmoil some emerging economies that had enjoyed rapid growth helped by a flood of cheap dollars.

In talks on the economy which were overshadowed by the Syrian crisis and which were described as "difficult" by participants, emerging and developed powers in St. Petersburg managed to find a common form of words.

Leaders of the G20 - which accounts for 90 percent of the world economy and two-thirds of its population - agreed to adjust policy carefully but said countries at the sharp end also had to put their houses in order.   Continued...