By James Saft
(Reuters) – The Group of 20 major economies chose to whistle and look the other way, effectively encouraging further yen falls and the inevitable currency skirmishes that implies.
It will also support growth and, all else being equal, a continued rally in risky assets like stocks.
While the G20, as ever, appeared pompous, out of touch and ineffective, the communiqué was a masterpiece of officious pretend cluelessness in a good cause.
“In all policy areas, we commit to minimize the negative spillovers on other countries of policies implemented for domestic purposes,” the G20 communiqué said, in the kind of statement that holds no one accountable for anything.
“We reaffirm our shared interest in a strong and stable international financial system. While capital flows can be beneficial to recipient economies, we reiterate that excess volatility of financial flows and disorderly movements in exchange rates have adverse implications for economic and financial stability.”