U.S. May Clash With Other G-7 Members --- Split Views on Market Regulation Expected to Cause Conflict at Meeting

U.S. Treasury Secretary Robert Rubin and Federal Reserve Chairman Alan Greenspan are headed for a confrontation with their Group of Seven counterparts in Bonn this weekend over how to avoid future financial crises. But while the G-7 may be split over the big-picture approach, they will likely agree...

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Bibliographic Details
Published inThe Wall Street journal Asia
Main Author By Michael M. Phillips and Dagmar Aalund
Format Newspaper Article
LanguageEnglish
Published Victoria, Hong Kong Dow Jones & Company Inc 18.02.1999
Subjects
American dollar
Central banks
Currency
Foreign exchange rates
Hedge funds
International finance
Regulation of financial institutions
Securities markets
Volatility
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Summary:U.S. Treasury Secretary Robert Rubin and Federal Reserve Chairman Alan Greenspan are headed for a confrontation with their Group of Seven counterparts in Bonn this weekend over how to avoid future financial crises. But while the G-7 may be split over the big-picture approach, they will likely agree on some small steps, including new foreign-reserve disclosure rules for central banks and the creation of a forum where countries would forge common regulations for hedge funds and other financial institutions. The philosophical dispute is most visible in discussions over how to stabilize exchange rates, which have been volatile for the past couple of years. Several proposals are likely to come up in Bonn this weekend, as well as at a heads-of-state summit in Cologne in June. Japanese, French and German officials are considering promoting "currency stability" by limiting how much each currency can move before governments intervene. More limited proposals call on central banks from the G-7 countries to make currency stability a major goal. The French are expected to suggest that the International Monetary Fund alert countries when their currencies get out of line.
ISSN:0377-9920