France to press G20 to curb currency swings -Sarkozy

PARIS, Aug 25 (BestGrowthStock) – France will ask G20 countries to
examine ways to curb excessive exchange rate and commodity price
volatility and pursue the idea of a financial transaction tax
when it holds the presidency of the Group of 20 economic powers
in 2011, President Nicolas Sarkozy said on Wednesday.

Addressing a diplomats’ conference in Paris, Sarkozy said
that he was not seeking a return to fixed exchange rates but
that G20 countries needed to find ways to limit excessive
exchange rate swings and the economic imbalances they create.

“Who would challenge the fact that exchange rate instability
poses a major threat to global economic growth?” asked Sarkozy.

He said that the current main forum for discussion of
exchange rates was the narrower G7 club but that China must not
be excluded from such discussions.

“What we surely need to do is go further and map out a new
framework for consultation on exchange rate developments,” said
Sarkozy.

“But how can we discuss exchange rates nowadays without
China? We need to debate a better way of responding on this
critical matter.

South Korea currently holds the presidency of the G20, which
spans the world’s largest industrialised and rapidly developing
economies, and Seoul will host a summit in late November before
the French take over the reins at the start of 2011.

Sarkozy said that commodity price volatility, highlighted by
the current surge in wheat prices, was also highly destructive
and that G20 countries should regulate commodity derivatives
just as it is seeking to do so for other financial derivatives.

“That way we will limit speculation,” he said.
(Reporting by Brian Love and John Irish; Editing by Hugh
Lawson)

France to press G20 to curb currency swings -Sarkozy