Japan is working closely with the US, its most important ally, to tackle soaring oil and food prices, the main topics of an international meeting starting yesterday, Japan's finance minister said.
“We need to coordinate our actions closely because of the many risk factors,” Japanese Finance Minister Fukushiro Nukaga told reporters after meeting US Treasury Secretary Henry Paulson in Osaka.
The officials are in Osaka for a two-day meeting of finance ministers from the G8 industrialized nations.
Nukaga declined to comment on the specifics of his conversation with Paulson about currencies but acknowledged the topic came up.
“I decline to comment as I usually don’t comment on foreign exchange matters,” he said at an Osaka hall, adding that it was unclear whether currency matters will be on the official agenda at the G8 meeting.
Weakness in the dollar has been a concern lately. It has contributed to the surge in oil prices because some traders invest in oil as a hedge against inflation and a slumping greenback.
The dollar has recovered against the yen and euro after Paulson warned earlier this week that he isn’t ruling out intervening in the currency market to stabilized the currency.
US Federal Reserve Chairman Ben Bernanke also helped lift the dollar by suggesting the Fed is prepared to raise interest rates to fight inflation.
Nukaga said work was going “smoothly” on an initiative for Climate Investment Funds being administered by the World Bank to provide money for developing nations to battle global warming.
Nukaga also expressed worries about the US economy, gripped by a credit crunch triggered by surge in defaults on risky mortgages.
That’s led to multibillion-dollar losses at financial companies and global market turmoil.
“We must remain vigilant on this still,” he said.
The G8 session — bringing together finance ministers from the US, Japan, Russia, Germany, France, Britain, Italy and Canada — is one of several ministerial meetings leading up to the July 7 to July 9 leaders’ summit on the northern island of Hokkaido.
The finance ministers were to have dinner with their counterparts and other officials from Australia, Brazil, China, South Korea, South Africa and Thailand to weigh the impact of surging oil and food prices on the global economy, the Ministry of Finance said.
Oil spiked to nearly US$140 a barrel last week, and several Asian countries, including India, Indonesia and Malaysia, have cut fuel subsidies, raising retail prices for millions of consumers.
French Finance Minister Christine Lagarde, a G8 participant, urged nations to work together to provide more information about oil reserves to calm upward pressures on oil prices.
“We need more information,” Lagarde said on the sidelines of the G8 gathering. “We shouldn’t rush into the adoption of measures without having tested them first.”
Meanwhile, the IMF said yesterday a slowdown in the global economy over the next few quarters should tame oil prices.
“The slowdown in growth will influence oil prices” on the downside, IMF Managing Director Dominique Strauss-Kahn said in Osaka.
The G8 ministers are expected to push the IMF to study anew how much speculative money is behind soaring oil prices. At a February gathering of finance ministers from the G7 — which excludes Russia — the IMF was asked to check on such speculative flows.
Strauss-Kahn also praised the Federal Reserve and European Central Bank for the way they have handled market turmoil so far, while defending central banks’ focus on inflation.
“Up to now in the subprime crisis, the Fed and the ECB have played their role well ... managing the crisis in the way we would have hoped,” he said.
“Inflation is a serious problem. It’s legitimate that central banks focus all their attention on it,” he said.
In April, the IMF projected global economic growth would slow to 3.7 percent this year from 4.9 percent last year.
The Washington-based institution predicts that the US economy, the world’s largest, will expand just 0.5 percent this year.
Super Typhoon Kong-rey is the largest cyclone to impact Taiwan in 27 years, the Central Weather Administration (CWA) said today. Kong-rey’s radius of maximum wind (RMW) — the distance between the center of a cyclone and its band of strongest winds — has expanded to 320km, CWA forecaster Chang Chun-yao (張竣堯) said. The last time a typhoon of comparable strength with an RMW larger than 300km made landfall in Taiwan was Typhoon Herb in 1996, he said. Herb made landfall between Keelung and Suao (蘇澳) in Yilan County with an RMW of 350km, Chang said. The weather station in Alishan (阿里山) recorded 1.09m of
STORM’S PATH: Kong-Rey could be the first typhoon to make landfall in Taiwan in November since Gilda in 1967. Taitung-Green Island ferry services have been halted Tropical Storm Kong-rey is forecast to strengthen into a typhoon early today and could make landfall in Taitung County between late Thursday and early Friday, the Central Weather Administration (CWA) said yesterday. As of 2pm yesterday, Kong-Rey was 1,030km east-southeast of Oluanpi (鵝鑾鼻), the nation’s southernmost point, and was moving west at 7kph. The tropical storm was packing maximum sustained winds of 101kph, with gusts of up to 126 kph, CWA data showed. After landing in Taitung, the eye of the storm is forecast to move into the Taiwan Strait through central Taiwan on Friday morning, the agency said. With the storm moving
NO WORK, CLASS: President William Lai urged people in the eastern, southern and northern parts of the country to be on alert, with Typhoon Kong-rey approaching Typhoon Kong-rey is expected to make landfall on Taiwan’s east coast today, with work and classes canceled nationwide. Packing gusts of nearly 300kph, the storm yesterday intensified into a typhoon and was expected to gain even more strength before hitting Taitung County, the US Navy’s Joint Typhoon Warning Center said. The storm is forecast to cross Taiwan’s south, enter the Taiwan Strait and head toward China, the Central Weather Administration (CWA) said. The CWA labeled the storm a “strong typhoon,” the most powerful on its scale. Up to 1.2m of rainfall was expected in mountainous areas of eastern Taiwan and destructive winds are likely
The Central Weather Administration (CWA) yesterday at 5:30pm issued a sea warning for Typhoon Kong-rey as the storm drew closer to the east coast. As of 8pm yesterday, the storm was 670km southeast of Oluanpi (鵝鑾鼻) and traveling northwest at 12kph to 16kph. It was packing maximum sustained winds of 162kph and gusts of up to 198kph, the CWA said. A land warning might be issued this morning for the storm, which is expected to have the strongest impact on Taiwan from tonight to early Friday morning, the agency said. Orchid Island (Lanyu, 蘭嶼) and Green Island (綠島) canceled classes and work
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