G20 summit unlikely to bring about decisive change in central banks' strategy

G20 Finance Ministers and central bankers are meeting in Shanghai today to discuss among other things the turbulence in the stock markets, the notable deterioration in the global economic outlook and of course the increasing doubts about the effectiveness of monetary policy.

The central banks have primarily focused on the price and foreign demand stimulating ability of a depreciating currency. They could probably start concentrating on domestic channels of monetary policy again and also accept appreciation. However, there a slim chances of the G20 agreeing to anything specific.

"We do not expect the G20 summit to decisively change the strategy of the central banks. That means the volatility in exchange rates is likely to remain high for the time being, lacking any clear trends." said Commerzbank in a research note.