G20 Thinking: “In The Medium Run We Are All Retired”

Another G20 summit meeting has come and gone. The heads of the eight leading industrialized nations, the G8, met first on Friday and Saturday, followed by the full G20 complement, representing the twenty most important global economies. The primary agenda for this summit was the global financial system and the world economy. Throughout the meetings, pronouncements of shared financial goals and economic cooperation were so frequently and publicly communicated as to become cliche, …not entirely unexpected for these kinds of events.

G20 leaders always try to beat expectations when they produce their final communiqué - and the expectations for today's final agreement have been set very low indeed. In the early hours of last night negotiatiors here made just enough progress on the vexed subject of exchange rates and global imbalances for all sides to declare victory.

OTTAWA — Given troubling signs of a decelerating global economy, it is not surprising financial leaders from the world’s most advanced nations will look at ways to recharge growth when they meet this week in the U.K. But it is unclear how much effort — and what results, if any — can be expected from the Group of Seven finance ministers and central bankers during what is being described at an informal gathering in the county Buckinghamshire, northwest of London.

Finance leaders of the G20 economies said on Friday they agreed they did not need to set hard targets for reducing national debt levels, and said they would be watching for negative effects from massive monetary stimulus efforts, such as Japan. Russian Finance Minister Anton Siluanov said at a news conference that finance officials from the Group of 20 nations believed overall debt reduction was more important than specific figures.

Seoul, South Korea: Mervyn King has a very clear idea of what should happen at the G20 meeting in Seoul over the next two days. He's a lot less certain about what will happen in the UK.  

The Monetary Policy Committee (MPC) hasn't changed its view of the UK economy today - but the IMF has. In the past three months the Fund's economists think our growth prospects have got notably worse, even though their forecast for the global recovery has been revised up.