Russian President Vladimir Putin (R) greets his Belarus counterpart Alexander Lukashenko during their meeting at the BRICS Summit in Ufa, Russia, July 9, 2015.SERGEI KARPUKHIN/Reuters
The BRICS group of developing countries, meeting in Russia to bolster ties, said they're disturbed by the turbulence that's roiled global markets from energy to stocks.
"We're concerned about instability in the markets, the high level of volatility in the prices of energy and raw materials, and the accumulation of sovereign debt of a number of major countries," Russian President Vladimir Putin said in the city of Ufa, nearly 1,300 kilometres east of Moscow. "All these structural imbalances directly affect growth."
The summit of leaders from Brazil, Russia, India, China and South Africa also discussed creating their own credit-ratings company and nurture direct investments between each other. Finance officials from the five countries earlier finalized a $100-billion (U.S.) reserves pool to ease liquidity issues during market stress and are forming a development bank.
The BRICS, coined in 2001 by ex-Goldman Sachs economist Jim O'Neil, gathered as a stock rout in China and uncertainty over Greece's euro future trigger gyrations in global financial markets.
Energy prices have been particularly jarred: the Chicago Board Options Exchange crude-oil volatility index signalled the most volatile trading in 12 weeks on Wednesday.
Having erased $3.9-trillion in less than a month, Chinese on shares gained 5.8 per cent Thursday. Russia's ruble, the second-worst performer against the U.S. dollar in the past year, strengthened 0.8 per cent in Moscow, as Brent oil prices advanced more than 3 per cent, data compiled by Bloomberg showed.
Chinese President Xi Jinping said global economic growth is slowing, and instability and uncertainty are on the rise. As the headwinds grow stronger, BRICS countries have the potential to develop ties, he added.