(Bloomberg) -- US Treasury Secretary Janet Yellen said she’s eager to build on recent improvements in US-China relations as finance chiefs from around the world gather in India to address global economic challenges in the coming days.

However, she said it was premature to use Chinese trade practices and US tariffs as an area for de-escalation, signaling that both sides are still wary. The US is completing a four-year review on the trade tariffs.  

Ahead of the Group of 20 meetings in Gandhinagar in Gujarat, the G-7 industrialized nations are gathering on Sunday to focus on support for Ukraine, the reform of multilateral development banks and a push to rework global supply chains. 

Key Developments 

  • Indonesia Upbeat on 5% Growth Despite Gloomy China Outlook (1)
  • Yellen Eyes China De-Escalation, But Lifting Tariffs ‘Premature’
  • G-20 Host India Seeks Bilaterals for Consensus Language on War
  • War, Debt Distress, Inflation: G-20 Finance Chiefs Spar in India
  • Geopolitical Wrangling Seen Shadowing India’s G-20 Finance Meet

(All times local)

G-7 Continues Russian Asset Freeze, Japan Finance Minister Says (2:10 p.m.)

The Group of Seven nations have confirmed the continuation of a Russian asset freeze, Japan’s Finance Minister Shunichi Suzuki told reporters after the meeting in India. Japan earlier hosted the G-7 meeting in India, which Ukraine Finance Minister Sergii Marchenko also attended virtually. 

On multilateral development bank reform, G-7 countries reiterated the importance of providing targeted support to leverage limited concessional financial resources and mobilizing private funds, Suzuki said. The group also welcomed the OECD international taxation package.

There was no discussion of exchange rates at the meeting, Suzuki said.

Bank of Japan Governor Kazuo Ueda told reporters after the same meeting that the G-7 members shared that the global economy isn’t slowing as much as expected although uncertainty remains high going forward.

Indonesia Still Optimistic About Growth Despite Gloomy Signs from China (12:30 p.m.)

Indonesia Finance Minister Sri Mulyani Indrawati said she was optimistic about the 5% economic growth target this year despite the darkening global outlook, especially from China.

“We are optimistic for 2023 because we see the figures on the first half,” Indrawati said in an interview with Bloomberg Television’s Haslinda Amin ahead of the G-20 finance chiefs’ meetings in India. “The second half, there is a positive side from our own side, explicitly on household consumption.”

Yellen Says Premature to Use Tariffs as Area for De-Escalation With China (10:34 a.m.)

Treasury Secretary Janet Yellen said Chinese trade practices and US tariffs are an issue where progress could be made but it’s “premature to use this as an area for de-escalation.”

“It would be useful to look for ways to de-escalate over time,” Yellen told reporters ahead of the G-20 meetings. “We are completing a four year review. But I would say the tariffs were put in place because we had concern with unfair trade practices on China’s side.”

Yellen Wants to Work with China on Debt Restructuring (10 a.m.)

Yellen said on Sunday that she will work with China on areas of mutual interest including debt restructuring for poorer countries and that multilateral development banks needed more reforms to hike lending capacity. 

“I am eager to build on the groundwork that we laid in Beijing to mobilize further action,” Yellen said in remarks ahead of a G-20 finance chiefs meeting. She said her visit to Beijing last week put the relationship between two biggest economies on “surer footing.” 

India, UAE to Trade in Local Currencies, Link Payments Systems (19:20 p.m.)

India and the United Arab Emirates agreed to use their respective local currencies for cross-border transactions, as Prime Minister Narendra Modi pushes the rupee’s role on the global stage.

The two memorandum of understandings will facilitate “seamless cross border transactions and payments, and foster greater economic cooperation between the two countries,” the Reserve Bank of India said in a statement on Saturday, as Modi and the central bank’s Governor Shaktikanta Das inked the agreements with the UAE’s President Sheikh Mohammed Bin Zayed Al Nahyan in Abu Dhabi.

India Seeks Bilaterals for G-20 Consensus Language on War (5 p.m.)

The Group of Twenty countries’ leaders won’t come together to discuss the language describing Russia’s war in Ukraine, with host India shifting to one-on-one discussions in an attempt to get an agreement.

With G-20 nations taking sides in the war — mainly for Ukraine — India is taking steps so that consensus on language can be achieved at the leaders’ summit in September, according to people familiar with the matter. They declined to be identified as discussions are private.

--With assistance from Andy Clarke, Sudhi Ranjan Sen and Kurien Abraham.

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