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This is an archive article published on November 7, 2009

FX problems symptom not cause: IMF8217;s Youssef

A meeting of Group of 20 finance leaders should not be fixated on exchange rate levels,as they are a symptom of underlying economic problems rather than a cause,the head of the International Monetary Fund's policy-steering committee told Reuters.

A meeting of Group of 20 finance leaders should not be fixated on exchange rate levels,as they are a symptom of underlying economic problems rather than a cause,the head of the International Monetary Fund8217;s policy-steering committee told Reuters.

Egyptian Finance Minister Youssef Boutros-Ghali,who chairs the International Monetary and Financial Committee,also said that Brazil8217;s proposals for a tax on capital inflows were unlikely to be effective.

8220;We should not be fixated on currencies. Although they are important and they do impact very significantly and very quickly on various financial flows,they should be seen as the symptom of a deeper disagreement,8221; he said on the sidelines of the meeting of G20 finance ministers and central bankers in St Andrews,Scotland.

Boutros-Ghali said he did not expect major breakthroughs at the summit,which gathers the world8217;s major developed and developing countries in one forum.

8220;The climate issue is on the table,though it was not discussed yesterday night. But I don8217;t think anyone expects a major breakthrough. This is not a breakthrough meeting,8221; he said.

8220;It is a day-to-day running of the system meeting 8212; how do we exit together,how do we principles that guarantee consistency in policy. This is actually a meeting where you are putting in march the machinery that you have established in London and Pittsburgh.8221;

 

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