Independence Has Served Central Banks Well: Lagarde

Marco Green
April 15, 2019

Chen Yulu, deputy governor of the People's Bank of China, said Beijing is working toward treating Chinese and foreign-funded financial institutions "equally in a way that is more transparent and consistent with best worldwide practices".

"If you model tariffs on a large portion of the goods that are traded, you take the entire volume of goods traded between the US and China in particular, $500 billion, you apply tariffs to that, you are putting at risk 0.8 percent of global growth", IMF Managing Director Christine Lagarde said.

"It is critically important that we work tirelessly to foster broad-based growth, raise median incomes, create jobs and fully incorporate women and young people in economies", Malpass said in a statement.

At a closing news conference, the committee chairman, Lesetja Kganyago, head of the central bank of South Africa, said every country needs to be ready to address issues involving financial stability "with all available tools".

"The last thing we want is another downturn", Lipton said, on the sidelines of the fund's spring meetings in Washington.

With respect to policies related to the exchange rate of China's currency, the RMB, Chen said "China will continue to improve the exchange rate mechanism and keep the RMB exchange rate in line with fundamentals at an adaptive equilibrium level".

"Despite the expected improvement in global economic growth, if economic slowdowns in major economies feed into other economies, the prospects for growth might deteriorate, bringing uncertainty across the entire global economy", Japanese Finance Minister Taro Aso said in his statement to the International Monetary Fund committee.

"Prudent monetary policy will be neutral in general", Chen said.

"China's larger-than-expected fiscal policy response will help offset the impact of weaker external demand", he said.

Chen also criticised the USA over bilateral trade frictions and amid ongoing talks.

"The protectionism of some countries has harmed mutual trust among countries, limited the scope for multilateral cooperation and impeded the willingness to achieve it", he said.

He added: "Unilateralism and protectionism can only exacerbate domestic imbalances and impair necessary structural adjustments, which can negatively affect the countries concerned as well as global growth".

-China commerce conflict. The planet's two largest economies have slapped tariffs on $350 million worth of one another's goods.

There's also a risk of new fronts breaking out in the trade war.

The central banker also expressed hope for a trade deal with the United States, echoing an earlier statement from the International Monetary Fund. They are battling over USA allegations that China deploys predatory tactics - including cybertheft and forcing foreign firms to hand over trade secrets - in a sharp-elbowed effort to challenge American technological dominance. "Trade friction can also dampen market confidence, which in turn amplifies financial market volatility and has an impact on economic growth".

Chen Yulu also said Beijing is working toward treating Chinese and foreign-funded financial institutions "equally in a way that is more transparent and consistent with best global practices".

He stressed China's ongoing opening up would create a "win-win" situation for domestic companies and their global partners.

Other reports by Click Lancashire

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