The global economy is changing too rapidly for governments to successfully impose major changes in the way they manage exchange rates, U.S. Treasury Secretary James A. Baker III said Friday.
Baker said he favors gradual, step-by-step efforts to improve coordination of monetary policy among the major industrialized countries.He cited as an example a possible broadening of coordination on national tax reform and deregulation of financial and labor markets. The United States also could work more closely with its major trading partners in monitoring the performance of their economies, he said.
But in remarks prepared for delivery to the Council on Foreign Relations, Baker ruled out any "sweeping, revolutionary changes in the system."
His appearance before the council was closed to the news media. Copies of his speech were made available in advance.
Baker met on Wednesday and Thursday in Paris with trade and finance ministers from the 24 members of the Organization for Economic Cooperation and Development.
"An attempt to make an abrupt or major change in the structure of the system by imposing a detailed set of formal constraints might well be viewed by the markets as overly ambitious and unsustainable," Baker said.