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G7 demands markets must determine exchange rates

February 13, 2013

The G7 (U.S., Britain France, Germany, Japan, Canada & Italy) reiterated their commit-ment to market-determined exchange rates and said fiscal and monetary policies must not be directed at competitive devaluations. The group agreed to consult closely and cooperate as appropriate on exchange rates, which if allowed to move in a disorderly fashion, could hurt economic and financial stability.

Fiscal and monetary policies have been and will remain oriented towards meeting the respective domestic objectives using domestic instruments, and should not target exchange rates, the G7 said, just days before the G20 ministers and central bankers meet in Moscow at the end of this week.