New Delhi: G20 leaders Saturday reiterated the need for well-calibrated monetary, fiscal, financial, and structural policies to promote growth, reduce inequalities and maintain macroeconomic and financial stability.
The global leaders also stressed that central banks remain strongly committed to achieving price stability in line with their respective mandates, according to the G20 New Delhi Leaders’ Declaration.
Noting that global economic growth is below its long-run average and remains uneven, the Declaration said the uncertainty around the outlook remains high.
With notable tightening in global financial conditions, which could worsen debt vulnerabilities, persistent inflation and geoeconomic tensions, the balance of risks remains tilted to the downside.
“We, therefore, reiterate the need for well-calibrated monetary, fiscal, financial, and structural policies to promote growth, reduce inequalities and maintain macroeconomic and financial stability,” the Declaration said
The leaders also welcomed the initial steps taken by the Financial Stability Board (FSB), Standard Setting Bodies (SSBs) and certain jurisdictions to examine what lessons can be learned from this recent banking turbulence and encourage them to advance their ongoing work.
The G20 leaders said they will use macroprudential policies, where required, to safeguard against downside risks.
“Central banks remain strongly committed to achieving price stability in line with their respective mandates. They will ensure that inflation expectations remain well anchored and will clearly communicate policy stances to help limit negative cross-country spillovers,” the Declaration said.
It further said the independence of central banks is crucial to maintaining policy credibility.
“We will prioritise temporary and targeted fiscal measures to protect the poor and the most vulnerable, while maintaining medium-term fiscal sustainability. Ensuring the overall coherence of the monetary and fiscal stances remains important,” the Declaration said.
It further added that they recognise the importance of supply-side policies, especially policies that increase labour supply and enhance productivity to boost growth and alleviate price pressures.
The leaders committed that they will protect the vulnerable, through promoting equitable growth and enhancing macroeconomic and financial stability.
Such an approach will help resolve the cost-of-living crisis and unlock strong, sustainable, balanced, and inclusive growth, the Declaration said.
PTI