The G20 calls for new support for growth: “monetary policy and flexibility” – The Republic

MILAN – Brexit and refugee crisis: are two new fears to take the show on the table Great countries, so that updates the catalog of their concerns about the fragile economic growth, already undermined by the now old bogeys represented by China and financial market volatility. For this, the commitment that comes out from the table of the G20 Shanghai at the end of two days of work should focus precisely on the need to maintain an even ultra-accommodative monetary policy by central bankers, which will accompany the second crutch budgetary flexibility to conduct back to balanced growth.

According to reports filtered from an Italian night at international agencies, in its final communiqué, the G20 noted that “monetary policy alone can not lead to balanced growth. ” After the light of the moon markets and massive outflows of capital from China and emerging markets, the finance ministers of major economies say they agreed “to consult rapidly” and closely on what is happening in the currency markets, this by launching the alarms on the volatility, which may impair economic stability. Promises also came on the desire to closely monitor the flow of capital in order to anticipate possible shocks, while returns the call not to use competitive currency devaluations (which sounds particularly strong ear of Chinese hosts, although there ‘is no direct reference to issues related to the slowdown of Beijing and the change of the Asian giant’s economic policy).

“the recent volatility does not reflect the fundamentals of the global economy. We expect that the economy will continue to grow at a moderate rate in advanced economies, and that growth in emerging economies remains strong, “says the draft communique of the G20 Finance Ministers and central Bank Governors in Shanghai. “The global recovery continues, but remains uncertain and below our ambitions for strong, sustainable and balanced.”

As mentioned, these financial aspects will add new factors of tension. A possible Brexit (the exit of Britain from the EU as a result of the referendum) is one of the potential shocks that weigh on the global economy, recite the drafts of the final communique viewed by Bloomberg : this would be a victory of the British government, able to deploy so worldwide in favor of a stay in the Union by London. At Brexit, then, there is a crisis of migrants. Only the opening session, on the other hand, the Organisation for Economic Co-operation and Development warned on stopping the global recovery. The OECD have political message was strongest when it came to emphasize the concern for the break in the reform process than that seen in the 2013-2014 season: in both advanced economies and emerging modernization of States suffered a backlash, last year.

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g20

markets

brexit

migrant crisis

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