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G-20 finance, central bank chiefs start talks

The Yomiuri Shimbun

Bank of Japan Gov. Haruhiko Kuroda speaks to reporters ahead of the G-20 talks in Washington.

Jiji Press WASHINGTON (Jiji Press) — Finance and central bank chiefs of the Group of 20 advanced and emerging economies kicked off their two-day talks in Washington on Thursday.

On the first day, they discussed recent developments in the global economy, and how and to what extent the tapering of monetary stimulus by the U.S. Federal Reserve and the European Central Bank will affect the global financial markets and the world economy.

The officials also exchanged views on geopolitical risks associated with North Korea, which continues nuclear and missile development, and other areas, sources with access to the meeting said.

From Japan, Bank of Japan Gov. Haruhiko Kuroda and Vice Finance Minister for International Affairs Masatsugu Asakawa are attending the meeting. Finance Minister Taro Aso skipped the G-20 session, which is being held ahead of the Oct. 22 general election in Japan.

While the global economy is steadily growing, it is also true that there are uncertainties, Kuroda told reporters before the start of the meeting, stressing the need to keep a close watch on economic and financial market developments around the world.

The Fed has started shrinking its balance sheet, after its holdings of assets ballooned in line with the quantitative monetary easing it launched after the 2008 collapse of U.S. investment bank Lehman Brothers.

The ECB has started considering scaling down its quantitative easing.

Concerns are growing that the Fed and ECB moves may cause massive funds to flow out of emerging economies.

The G-20 officials also discussed low inflation in Japan and Europe. They agreed to take appropriate fiscal and monetary policies, and promote structural reforms while remaining alert for unexpected financial market turmoil.

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