G20 finance ministers concluded meetings over the weekend in France where they highlighted the key role of exchange rates, monetary and fiscal policies in determining whether a country's policies lead to imbalances.
The communique issued after the meetings said G20 countries were committed to enhanced exchange rate flexibility. It also pointed out the need for an improved international monetary system to avoid disruptive swings in capital flows and exchange rates. The inclusion of exchange rates to determine imbalances was a key point of contention for China — whom many, especially the U.S., believe artificially holds down the value of its currency, contributing to global imbalances.
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