So the meeting of G7 finance minister and central bank presidents has concluded, and, despite grumbles from the Democratic US Congress and the EU’s ECOFIN about the weakness of the Japanese yen, the final statement in Essen included nothing that directly referred to Japanese monetary policy.

Instead, the only country named directly in the paragraph on exchange rate policy is China, together with other developing countries:

We reaffirm that exchange rates should reflect economic fundamentals. Excess volatility and disorderly movements in exchange rates are undesirable for economic growth. We continue to monitor exchange markets closely, and cooperate as appropriate. In emerging economies with large and growing current account surpluses, especially China, it is desirable that their effective exchange rates move so that necessary adjustments will occur. (Statement available for download here)

So Japan has once again been granted a reprieve, with China remaining the favored scapegoat of developed countries feeling the crush of competition from the BRICs and the rest of the developing world. Perhaps the G7 balked at the potential consequences of a statement that might spark the rapid “unwinding” of the yen carry trade.

In any case, the yen remains weak, Japanese interest rates remain extremely low, and the G7 remains a body with questionable relevance in the rapidly changing international system.