5 Sep 2013
G20 to focus on Syria and Fed QE taper
FXstreet.com (Barcelona) - It is expected that the leaders of the Group of 20 major economies' summit, which will begin later today in St. Petersburg, Russia, will mostly focus on the Syrian conflict, as well as the withdrawal of stimulus by the Fed and it's impact on the global economy.
Russia and China opposed to US strike on Syria
Yesterday, the US Senate backed President Barack Obama's call for a military intervention in Syria, prompted by the chemical weapons attack near Damascus on 21 August in which over 1429 people were killed (according to US estimates). Russia is against such a move however, arguing that there is not enouch evidence to prove that the Syrian government carried out the attack.
China on the other hand points to the adverse effect a strike on Syria would have on the global economy and especially on the proice of oil. Chinese deputy finance minister Zhu Guangyao, who spoke to reporters ahead of the meeting, said that the UN should try to resolve the situation through negotiations.
EM and the Fed QE taper
Another important issue on the summit agenda is the Fed stimulus withdrawal and its impact on the emerging markets' economies, which might experience excessive financial market volatility in the wake of the move. Zhu Guangyao commented on this issue as well, expressing hope that the US to be "mindful of the spillover effects and work to contribute to the stability of the global financial markets and the steady recovery of the global economy."
The impact of the Fed stimulus pullback also worry India. The country's economic affairs secretary Arvind Mayaram urged the G20 to clearly define its position on the matter and the possible spillover effects. "I think if a strong statement is made on these two points, it will have a major calming impact on the markets in the emerging economies," he said.
Russia and China opposed to US strike on Syria
Yesterday, the US Senate backed President Barack Obama's call for a military intervention in Syria, prompted by the chemical weapons attack near Damascus on 21 August in which over 1429 people were killed (according to US estimates). Russia is against such a move however, arguing that there is not enouch evidence to prove that the Syrian government carried out the attack.
China on the other hand points to the adverse effect a strike on Syria would have on the global economy and especially on the proice of oil. Chinese deputy finance minister Zhu Guangyao, who spoke to reporters ahead of the meeting, said that the UN should try to resolve the situation through negotiations.
EM and the Fed QE taper
Another important issue on the summit agenda is the Fed stimulus withdrawal and its impact on the emerging markets' economies, which might experience excessive financial market volatility in the wake of the move. Zhu Guangyao commented on this issue as well, expressing hope that the US to be "mindful of the spillover effects and work to contribute to the stability of the global financial markets and the steady recovery of the global economy."
The impact of the Fed stimulus pullback also worry India. The country's economic affairs secretary Arvind Mayaram urged the G20 to clearly define its position on the matter and the possible spillover effects. "I think if a strong statement is made on these two points, it will have a major calming impact on the markets in the emerging economies," he said.