G-20 Draft Calls for Accommodative Monetary Policy to Aid Growth

by Raymond Colitt

(Bloomberg) -- Finance ministers and central bank chiefs from the Group of 20 nations agree that monetary policy needs to stay accommodative until the outlook for economic growth improves, according to a draft communique obtained by Bloomberg.
The group also welcomed the recent decision by the European Central Bank to start buying government bonds, saying it will “further support the recovery in the euro area.”
Officials from the world’s biggest 20 economies are meeting in Istanbul at a time when the U.S. is leading global growth while the euro-area struggles to recover. The communique made no mention of the Greek debt crisis, which has become the focus of euro zone officials due to gather for an emergency meeting later this week.

“Monetary policies need to remain accommodative until the outlook for growth, and price and financial stability allow for normalization,” the officials said, according to the draft. “In an environment of diverging monetary policy settings and rising financial market volatility, policy settings should be carefully calibrated and clearly communicated to minimize negative spillovers.”