This article is from the source 'guardian' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.

You can find the current article at its original source at http://www.theguardian.com/business/2015/oct/12/western-economies-are-still-too-weak-to-cope-with-fed-rate-rise-says-china

The article has changed 2 times. There is an RSS feed of changes available.

Version 0 Version 1
Western economies are still too weak to cope with Fed rate rise, says China Western economies are still too weak to cope with Fed rate rise, says China
(about 3 hours later)
The slow recovery of western economies means the US Federal Reserve should not raise interest rates yet, according to the Chinese finance minister.The slow recovery of western economies means the US Federal Reserve should not raise interest rates yet, according to the Chinese finance minister.
Related: The Fed must ignore accusations of dithering over interest ratesRelated: The Fed must ignore accusations of dithering over interest rates
Speaking on the sidelines of the annual meeting of the World Bank and International Monetary Fund in Lima, Lou Jiwei said developed economies were to blame for the global economic malaise because their slow recoveries were not creating enough demand.Speaking on the sidelines of the annual meeting of the World Bank and International Monetary Fund in Lima, Lou Jiwei said developed economies were to blame for the global economic malaise because their slow recoveries were not creating enough demand.
“The United States isn’t at the point of raising interest rates yet and under its global responsibilities it can’t raise rates,” Lou said in an interview published in the China Business News on Monday.“The United States isn’t at the point of raising interest rates yet and under its global responsibilities it can’t raise rates,” Lou said in an interview published in the China Business News on Monday.
The minister said the US “should assume global responsibilities” because of the dollar’s status as a global currency.The minister said the US “should assume global responsibilities” because of the dollar’s status as a global currency.
Lou’s comments came as Asian shares extended an impressive 11% rise this month as investors were encouraged by the Fed’s failure to raise rates in September.
“Any signs of stimulus is being seized by the markets as a sign of stabilisation and there is some bargain hunting, especially in the beaten down sectors, related to commodities,” said Nicholas Yeo, head of equities (China/Hong Kong) at Aberdeen Asset Management.
While Beijing has generally refrained from launching widespread stimulus measures to boost slowing growth, it has resorted to a steady drip-feed of measures in recent weeks to support various sectors ranging from housing to cars, calming investor sentiment, and sparking a rally in the Hong Kong listed shares of Chinese companies.
China’s shares led the region’s markets higher with Hong Kong and Shanghai up more than 1% each on Monday. Korea was up 0.5%. Japan is shut for a holiday.
Lou’s comments were published hours after Fed vice-chairman Stanley Fischer said policymakers were likely to raise interest rates this year, but that that was “an expectation, not a commitment”.Lou’s comments were published hours after Fed vice-chairman Stanley Fischer said policymakers were likely to raise interest rates this year, but that that was “an expectation, not a commitment”.
Asked about the global economic situation, Lou said the problem was not with developing countries.Asked about the global economic situation, Lou said the problem was not with developing countries.
“Rather, it is the continued weak recovery of developed countries” that’s hindering the global economy, he said.“Rather, it is the continued weak recovery of developed countries” that’s hindering the global economy, he said.
“Developed countries should now have faster recoveries to give developing countries some external demand.”“Developed countries should now have faster recoveries to give developing countries some external demand.”
Lou welcomed the structural reforms in Europe as a positive development, but said geopolitics and the Syrian refugee crisis would have an impact on its economy.Lou welcomed the structural reforms in Europe as a positive development, but said geopolitics and the Syrian refugee crisis would have an impact on its economy.
He described the slowdown in China’s economy as a healthy process, but said policy makers needed to manage it carefully.He described the slowdown in China’s economy as a healthy process, but said policy makers needed to manage it carefully.
“The slowing of China’s economic growth is a healthy process, but it is a sensitive period. The Chinese government must make accurate adjustments, keeping the economy within a predictable space while continuing to promote internal structural reforms,” he said.“The slowing of China’s economic growth is a healthy process, but it is a sensitive period. The Chinese government must make accurate adjustments, keeping the economy within a predictable space while continuing to promote internal structural reforms,” he said.