Obama defends Fed’s plan amid global criticism

The currency issue remained a touchy subject heading into the G-20 this week, following criticism over the Fed’s easing move last week. 

China says the Fed’s move makes the U.S. guilty of what Washington has accused China of doing, undervaluing its currency to boost exports.

“As a major reserve currency issuer, for the United States to launch a second round of quantitative easing at this time, we feel that it did not recognize its responsibility to stabilize global markets and did not think about the impact of excessive liquidity on emerging markets,” Chinese Finance Vice Minister Zhu Guangyao said Monday.

Russian leaders suggested U.S. officials run policies past the other major global economies first.  

“Russia’s president will insist … that such actions are taken with preliminary consultations with other members of the global economy,” said Arkady Dvorkovich, a Russian official who is preparing the country’s position in Seoul.

Meanwhile, European Central Bank President Jean-Claude Trichet said all participants at a meeting of the world’s central bankers in Basel, Switzerland, had insisted they were not pursuing weak currency policies.

“We’re attached to avoiding excessive volatility. It’s very counterproductive for global growth and global stability,” he told a news conference.