Tuesday, May 22, 2007

David Dodge World Bank Nominee

Is David Dodge, the outgoing Governor of the Bank of Canada, bucking for Presidency of the World Bank? Seems like it....

Dodge, who retires in January and has said he wants half a year off after that, declined to say today if he's interested in the job.

- Bank of Canada Governor David Dodge said China's government can't be expected to let the market set its currency's foreign-exchange rate ``overnight.''

``They have to keep going, and they have to keep going pretty rapidly,'' Dodge told reporters today after a speech to the Chicago Council on Global Affairs. ``But let's not expect everything to be done overnight.''

In his remarks, Dodge said that the world's most developed nations need to have ``some tolerance'' as long as countries such as China are making ``substantial progress'' in shifting toward flexible exchange rates. Some economies don't have financial markets that are developed enough to withstand an immediate move to prices set in markets, he said.

Dodge's remarks are more measured than those of U.S. officials, who demanded last week that China move more quickly on loosening its management of the yuan. The People's Bank of China on May 18 increased the amount that the currency can move each day. U.S. Treasury officials and lawmakers said China must use that increased flexibility to allow its exchange rate to climb.

Chinese officials ``understand that it's not to satisfy the Americans or the Europeans and Canadians, they need to do it for their own domestic growth,'' to move on the yuan, Dodge said.

In his speech, Dodge urged the Group of Seven industrialized nations, especially the U.S., to pursue changes at the International Monetary Fund so it can more effectively combat world trade imbalances.

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