India's central bank head accuses G7 nations of currency manipulation.
Global Banking News-April 17, 2015--India's central bank head accuses G7 nations of currency manipulation
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Global Banking News - 17 April 2015
Raghuram Rajan, head of the Indian central bank, has accused G7 nations of currency manipulation.
In a statement, Rajan said that largest industrial countries are flouting global financial rules. He added that the International Monetary Fund has to be a more neutral referee and flag offences.
He said, 'We really need to assess our rules of the game.' He was speaking at a seminar on the side-lines of the IMF/World Bank spring meetings. The group of 20 officials has accepted the recent decline in the yen and the euro as the by-product of monetary policies designed to spur domestic demand. Rajan said that the richest countries were ignoring the spill-over effects on emerging markets. 'We need arbiters like the IMF to tell us when domestic policies have international effects that do more harm than good,' he added.
At the seminar, Olivier Blanchard, the IMF's chief economist, said he strongly disagreed with Rajan. He said the main effect of Europe's quantitative easing has been lowering long-term interest rates.
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