Japan welcomes US, Europe moves to calm markets

TOKYO : Japan on Monday welcomed global action to calm markets and said it hoped they would ensure financial stability

The Group of Seven vowed to support financial stability and the European Central Bank pledged to buy eurozone bonds to stem a global debt crisis as jittery markets re-opened after last week's punishing losses.

"As a member of the G7, we welcome a string of measures taken in the United States and Europe," Finance Minister Yoshihiko Noda told reporters.

Asian markets fell on Monday amid fears over the state of the global economy, with Tokyo down more than two percent, Hong Kong losing four percent and Sydney 1.90 percent lower.

The statement Monday from the G7 -- Britain, Canada, France, Germany, Japan, Italy and the United States -- said the major industrialised powers were "committed to taking coordinated action where needed".

It noted that the United States had adopted reforms that will deliver a deficit cut while the Euro area Summit decided last month a comprehensive package to tackle the situation in Greece and other countries.

Noda said Tokyo hoped "the measures mentioned in the statement, implemented appropriately, will ensure market stability and growth."

"We want the market to take this point firmly," he said.

Chief Cabinet Secretary Yukio Edano, the top government spokesman, also welcomed the moves, expressing hope they would bring stability to markets.

Japan also threw its support behind US bonds despite the first ever downgrade of US credit by major ratings agency Standard & Poor's.

"Confidence in the US bonds is unshaken," Noda said amid fears of market turbulence, arguing US Treasury bonds are "an attractive financial product".

Japan is the second largest holder of US Treasury bonds after China.

Noda said excessive foreign exchange movements are undesirable but declined to comment on whether Japan had gained understanding from G7 partners on its currency market intervention last week to bring down the strong yen.

The dollar fetched 78.11 yen in Tokyo afternoon trade, compared with rates below 77.00 yen last week before the government stepped into markets.

 

Copyright AFP (Agence France-Presse), 2011

 

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