G7 commits to ensuring stability of global financial markets

Aug 8, 2011, 0:20 GMT

Tokyo - Group of Seven (G7) finance ministers in a telephone conference early Monday stressed their commitment to ensuring stability in global financial markets.

'We are committed to taking coordinated action where needed, to ensuring liquidity, and to supporting financial market functioning, financial stability and economic growth,' the G7 finance ministers and central bank governors said in their joint statement released Monday morning.

The finance ministers and central bankers of G7 member states Britain, Canada, France, Germany, Japan, Italy and the United States confirmed excessive volatility would negatively affect the global economy, Japan's Finance Minister Yoshihiko Noda told reporters.

The G7 representatives would discuss market stability measures in upcoming weeks, Noda said.

'We will remain in close contact throughout the coming weeks and cooperate as appropriate, ready to take action to ensure stability and liquidity in financial markets,' the statement said.

The statement was issued amid growing concern that Friday's downgrading of US government debt by credit rating agency Standard and Poor's could further deteriorate sentiment.

As Asian markets started to open, stocks fell, with the New Zealand NZX50 losing 3.3 per cent, Japan's Nikkei down 1.3 per cent, and the Australian 2.1 per cent dropping 2.1 per cent in early trading.

Markets were in turmoil last week, responding negatively to persistent concerns that Europe's debt crisis could spread to Spain and Italy, as well as the deal struck in Washington to increase the US debt ceiling.