What Does the G−7 Think About Currencies?
The G-7 meets this weekend in Istanbul. So what’s on the minds of these leaders of the top industrialized countries of the world? They’re all worried about currencies. Specifically, how currencies will impact their own recoveries and the recovery of the global economy. The G-7’s predecessors have a history of assuming an important role in currencies. The G-10 was created to stave off attacks on the dollar and the British pound in the 1960s. And the G-5 was formed in the 1970s to try to manage the new world of flexible exchange rates. But with new power shift to the G-20 announced last week, the G-7 might not even release a communiqué this time. What we do know, however, is that they will discuss currencies. Since March … • The euro has jumped 21 percent against the dollar, • The Canadian dollar has gained 17 percent, • The British pound has risen 16 percent, • And the Japanese yen has climbed 11 percent. Most of this currency strength is explained by an improving global economic pict
