ST. PETERSBURG, September 6 (RIA Novosti) – US President Barack Obama reportedly promised delegates at the G20 Summit in St. Petersburg Thursday that quantitative easing in the United States would be wound down gradually, in an apparent attempt to allay emerging markets fears about any sudden shifts in US monetary policy.
“When the US president spoke he underlined that such a policy [an end to quantitative easing] will be carried out gradually,” Russian Finance Minister Anton Siluanov told reporters Thursday evening, the Prime News Agency reported. “It was said that tapering will happen within reasonable limits. That’s absolutely correct.”
The United States’ latest round of quantitative easing (QE3), designed to boost the US economy, was launched last year and the Federal Reserve is widely expected to begin winding down the $85 billion monthly bond buying program at its upcoming meeting later in September.
Emerging markets, including Russia, are wary that adjustments to QE3 could have serious consequences for their economies, causing significant outflows of investment and depreciating their currencies.
The Indian rupee, the Brazilian real and, to a lesser extent, the Russian ruble, have all fallen against the dollar this year as expectations about an end to QE3 have grown.
“The majority of countries with developing economies take the position that it is essential to take careful action when winding down this policy,” Siluanov said, according to Prime.
Discussions about an end to QE3 are expected to be one of the big economic themes for world leaders during the G20 summit in the Constantine Palace outside St. Petersburg, which is being dominated by discussions about the ongoing crisis in Syria. The summit ends Friday.
Siluanov also said Thursday that the participating countries had reached agreements about regulation of the world’s shadow banking sector, tax evasion, the reduction of state debt and economic growth plans, Prime reported.
Add to blog
You may place this material on your blog by copying the link.
Image Galleries: Removing Protesters’ Barricades in Kiev
Infographics: First Russian Smartphone
Some people are trying to make the reality in Russia at least a bit more humane. The amnesty should apply not only to persons involved in high-profile cases, but also to individuals who are not as well-known. It is better to set free at least some of the individuals who deserve to be released than no one at all.