The People´s Bank of China has tightened monetary policy again, lifting bank reserve requirements by 50 basis points to a record 19.5 per cent.

Group of 20 finance ministers say the global economic recovery "is strengthening but is still uneven and downside risks remain." But ministers failed to reach agreement on how to deal with imbalances.

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European shares were mixed on Friday as investors mulled speculation that the European Central Bank was readying to lift interest rates. While the FTSEurofirst index fell by 0.1pct, the German Dax was higher by 0.3pct but the UK FTSE eased 0.1pct.

US sharemarkets rose in quiet trade on Friday. Trading volumes have fallen to 12-year lows. At the close of trade, the Dow Jones index was up 73pts or 0.6pct to 32-month highs with the S&P 500 up 0.2pct and the Nasdaq was up 2.4pts or 0.1pct. Over the week the Dow Jones and S&P 500 were up 1.0pct and Nasdaq lifted by 0.9pct.

US treasuries were flat on Friday as equities rose and investors prepared for US$99bn in bond issuance in the coming week. US 2yr yields eased 1pt to 0.755pct but US 10yr yields were flat at 3.58pct. Over the week US 2yr yields fell by 8pts but US 10yr yields fell 5pts.

Major currencies rose in US trade on Friday ahead of the G20 meeting. The Euro rose from lows near US$1.3545 to US$1.3715 before ending US trade near US$1.3685. The Aussie dollar rose from US100.90c to US101.55c, before ending US trade at US101.45c and easing to US101.25c this morning. And the Japanese yen lifted from 83.45 yen per US dollar to around JPY83.00, and ending US trade near JPY83.10.

US crude oil prices fell on Friday with profit-taking ahead of a holiday weekend offsetting ongoing supply concerns about Middle East instability. There have been demonstrations in Yemen, Iran, Bahrain and Libya over the week. The Nymex crude oil contract fell by US16c or 0.2pct to US$86.20 a barrel. And the London Brent crude eased US7c to US$102.52 a barrel. Over the week Nymex crude rose by US62c or 0.6pct while Brent rose by 1.1pct.

Base metal prices rose on the London Metal Exchange on Friday, with a weaker US dollar prompting bargain hunting. Metals rose between 0.5-3.0pct with lead doing best and copper the worst. Over the week metals generally rose by 2.6-3.4pct except copper which fell 1.1pct. And the gold price edged higher in response to Middle East tensions and a weaker US dollar. The Comex gold futures price was up by US$3.50 an ounce to US$1,388.60. Silver hit a 31-year peak in the session. Gold rose by US$28.20 an ounce or 2.1pct over the week.

Ahead: In Australia, no major economic data is scheduled. Woodside Petroleum, West Australian Newspapers, Caltex, BlueScope Steel, Amcor and UGL are amongst those reporting earnings. In the US, markets are closed for the President´s Day holiday.

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