Looks like BRIC took a magor hit in their currencies, and the G-20 has is going to have Syria and Economics on the agenda

[ltr]Emerging crisis topping the agenda of the Group of Twenty summit[/ltr]
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September 2, 2013 08:21 PM Last Updated: September 02, 2013 8:24
 




Controlled the financial storm in the emerging countries and the Syrian crisis on the agenda of the Group of Twenty, which will be held on Thursday and Friday in Saint Petersburg in Russia at the summit is expected to be tense.

It is assumed that enshrines the leaders of rich countries and major emerging in a formal meeting of the world economic and financial issues. But in the atmosphere of tension caused by the possibility of a U.S. military strike against Syria, are likely to dominate the meeting, "a diplomatic event" as a French diplomatic source said, adding that the crisis emerging countries "will be a thorny issue" at the summit. And that if widened, "must be a discussion about the fact that the end of relaxing monetary policy of the United States."

On the American side, contend that if instead of the U.S. Federal Reserve policy, it means that the first economy in the world



Witnessing a recovery and this in itself is good news for the world.

Horizon

While it seems that the euro zone, which emerged from the downturn began to see light at the end of the tunnel, witnessing emerging countries, led by Brazil, India and Turkey problems with the decline in prices of their currencies as a result of the change, which was announced in U.S. monetary policy.

U.S. Federal Valahtaati or the central bank, the plunge years ago the financial system with liquidity to keep interest rates very low and support economic activity.

These funds are available at a cost of a few went largely to emerging markets where interest rates are high and the fastest growth attractive returns.

But with the economic recovery in the United States, the Federal Reserve is preparing to amend the situation and return to the first investors in the world economy, while growth tends to decline in emerging countries.

Said Chris Weafer of the Consultative Group "a macro Advisory Board" that the issue "carry the seeds of division because the negative effects already clear on the currencies of emerging nations."

He added that the economic expert that the countries concerned will ask the Federal Reserve cut its support for the economy "by taking into account collateral damage such as its own national interests."

During the period of stability, investors prefer to return their assets to safe areas while may result in the possibility of higher oil prices to weaken some of the more and more countries.

Memorandum

During the last preparatory meeting of Ministers of the Group of Twenty money in the end of July in Moscow, Brazil, Russia requested from the United States a clear memorandum in this regard is contained in the final statement of the meeting. Since then accelerated developments. India has recorded worked and Turkey, a significant decline of 25% and 11% respectively since the beginning of the year and بلغتا record levels of weakness despite attempts by central banks in both countries to reduce the decline.

In Brazil, the rial fell 15%, the central bank announced that it will be allocated fifty billion dollars to defend the currency.

Is not expected to feel free to Russia, which hopes to take advantage of its presidency of the Group of Twenty in order to make economic openness on investors in the world, in the transfer of these concerns.

The ruble has lost 10% of its value and record growth in Russia slowed suddenly beginning of the year. And President Vladimir Putin insisted Wednesday that the summit should give priority to growth and will be held while the "economy entered again a dangerous area."



Tension

Resulted in the rapid developments of the crisis in Syria to the intensification of the storm in the markets, reinforcing expectations that the discussions will see a tension between Western and emerging countries. But the Russian presidency confirms that the issue "is not included in the program," in the words of the representative of the Kremlin in the Ksenia Yudayeva group. According to Al-Bayan




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