G-7 to discuss ways to 'nurture recovery'

The role of central banks in shoring up the global economic recovery is set to be a key point of discussion among top financial officials from the world's seven leading economies when they gather in the UK this weekend.
The Japanese yen's continuing weakness is also expected to come under discussion now that the dollar has breached the 100 yen mark for the first time in a little over four years.
In a statement today ahead of the Group of Seven's two-day meeting at a country house around 80 kilometres northwest of London, British finance minister George Osborne said the main task officials face over the coming two days is how to "nurture" the recovery.

"The G-7 is an opportunity to consider what more monetary activism can do to support the recovery, while ensuring medium-term inflation expectations remained anchored," said Osborne, who will be hosting the event alongside the Bank of England's governor Mervyn King.
Osborne suggested that this "activism" may involve "targeted interventions" to support lending in weak parts of the economy. The UK treasury chief noted that the European Central Bank had already started consultations on how best to boost lending to small and medium-sized enterprises, the key engines of economic growth and employment.
US Treasury Secretary Jacob Lew said the G-7 discussions should center on how to boost growth and generate jobs. He said the US economy was healing but not at a fast enough pace.

"We're moving in the right direction but while growth is encouraging it's not sufficient," Lew told CNBC.

He singled out Europe as a laggard and said there was a need for policymakers there to get the right balance between austerity and growth.
"We're not arguing whether we need to get our fiscal house in order, we all need to do that, the question is when and how," Lew said.
The Treasury Secretary noted that some progress had already been made in striking that balance with the easing of some deficit-reduction deadlines among some of the 17 European Union countries that use the euro.

And in a hint that Germany should do more, Lew added that some countries have "more fiscal space" than others to boost demand. Many economists argue that Germany, the government and its people, should be spending more to stimulate growth across the rest of the eurozone. Europe's largest economy is running a budget surplus, albeit a fairly small one, as well as a current account surplus that is equivalent to around 6 per cent of its annual gross domestic product.