G20 accord on currency elusive, BOK official says

A high-ranking central banker in Korea predicted Friday that an accord to resolve the global currency disputes among G20 members will at best remain ambiguous, mostly helping prevent an inflow of speculative investors.

It would be impossible for the G20 members to make public a “specified” agreement, even though it is reached,  on the currency issue during their summitmeeting in Seoul on Nov. 11-12, said Kim Sung-min, chief of the G20 affairs office of the Bank of Korea.

“Some watchers seem to speculate that there will be an announcement on a certain (definite-level) accord in Seoul. But  I think it is impossible (to produce such an agreement),” he told The Korea Herald. 

Kim forecast a stereotypical accord, at least on their joint declaration ― also known as communique ― as the more feasible outcome even if the leaders reach a certain level of consensus for taming the latest currency war. 

“The foreign exchange market is very speculative,” he said. “If they reach a detailed agreement in their joint declaration, there is no doubt that it will invite a wave of speculative funds.”

More specifically, he said, it is very difficult for them to agree on the Chineserenminbi’s appreciation to a specified level against the U.S. dollar. “This could indicate directions of future foreign exchange rates and produce speculators in the market.”