G7 meeting fails to sink dollar

The Group of Seven repeated a call for more currency flexibility at its last meeting beginning Oct. 1, but did not raise pressure on China to revalue its yuan.

This lifted some weight from the dollar, which was driven down before the meeting. Any move by China to free the yuan — now pegged to the dollar at a level many analysts see as too low — would be expected to put downward pressure on the U.S. currency.

The G7 repeated language used at a meeting last February, reaffirming exchange rates should reflect economic fundamentals and calling for currency flexibility.

In addition, during the meeting the G7 warned high oil prices pose a risk to the global economy, but the economic outlook for 2005 was still favorable.