Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

G-20: We'll avoid currency war

By Aaron Smith, staff writer

NEW YORK (CNNMoney.com) -- Leaders of the G-20 nations on Friday agreed to "refrain" from all-out currency warfare, but failed to meet high expectations that they would come up with a plan to stabilize the world economy.

Completing a two-day summit in South Korea, the G-20 nations released their so-called Seoul Action Plan, a communiqué that outlines a wide range of macroeconomic policies.

The general goal, as stated at the outset of the world financial crisis in 2008, is to try and prevent the world from sliding into another economic slump.

"The actions agreed to today will help to further strengthen the global economy, accelerate job creation, ensure more stable financial markets, narrow the development gap and promote broadly shared growth beyond crisis," read the G-20 plan.

One of the many pledges is to "refrain from competitive devaluation of currencies." This is a direct reference to one of the more contentious subjects in international financial relations: the currency dispute between the United States and China.

"Advanced economies, including those with reserve currencies, will be vigilant against excess volatility and disorderly movements in exchange rates," read the G-20 plan.

U.S. critics believe that China is keeping its currency, the yuan, artificially low by hoarding reserves, keeping its exports cheap and undercutting international competitors.

U.S. Treasury Secretary Tim Geithner has tried to sort out the problem and defend against claims that the United States is deliberately weakening the dollar.

However, the conclusion of the G-20 summit failed to convince experts that any real progress had been made, particularly in the U.S-China currency dispute.

"The failure to agree to any definitive action should come as no surprise to the currency markets," said Mark O'Sullivan, director of dealings at Currencies Direct, a London-based currency transfer services company. "The vague set of indicative guidelines issued in the final communiqué, really once again underlines how little effect the G-20 can have on the current problems the global economy faces."

The G-20 said it will hold its next summit in France in 2011, followed by the 2012 summit in Mexico. To top of page

Overnight Avg Rate Latest Change Last Week
30 yr fixed3.83%3.81%
15 yr fixed2.88%2.89%
5/1 ARM3.09%2.99%
30 yr refi3.92%3.91%
15 yr refi2.97%2.99%
Rate data provided
by Bankrate.com
View rates in your area
Find personalized rates:
Index Last Change % Change
Dow 17,088.13 37.38 0.22%
Nasdaq 4,821.86 11.07 0.23%
S&P 500 2,016.88 3.45 0.17%
Treasuries 2.11 0.00 0.05%
Data as of 9:57am ET
Company Price Change % Change
Alcoa Inc 10.74 -0.27 -2.45%
Freeport-McMoRan Inc... 13.68 0.22 1.63%
Bank of America Corp... 15.78 0.03 0.19%
Apple Inc 110.40 0.89 0.82%
General Electric Co 28.05 0.02 0.07%
Data as of 9:42am ET


Oil prices have broken above the $50 per barrel mark for the first time since July. More

The National Domestic Workers Alliance introduced a new initiative, Good Work Code, to set standards and protections for on-demand workers. More

Karim Abouelnaga turned down a job on Wall Street to address a problem that set him back as a low-income student: the summer slide. More

Danny Miller is a self-taught investor from Mobile, Alabama. He's better at figuring out stock prices and company earnings than most Walll Street pros. More