Japan said that Group of Seven nations need to cooperate closely amid market turmoil and Chinese Vice President Xi Jinping called for a rebuilding of global confidence. In Tokyo, Finance Minister Yoshihiko Noda said that the G-7 needs “very close cooperation in coming weeks.” He didn’t specify any possible new measures. In Beijing, Xi told U.S. counterpart Joe Biden and business executives that his nation will not have an economic hard landing. Asian officials are seeking to calm investors as declines in equity markets crush consumer and business confidence, worsening the outlook for a global economy already hampered by the debt burdens of developed economies. Asian stocks extended today the rout in the U.S. and Europe yesterday, with the MSCI Asia Pacific Index falling 2.4 percent as of 12:07 p.m. in Tokyo. The market turmoil probably reflects concerns about the world economic outlook, Noda said at a press briefing. Asked how policy makers should respond, he referred to an Aug. 8 pledge by G-7 finance ministers and central bank governors to “take all necessary measures to support financial stability and growth.” Xi said confidence needs to be rebuilt after “destabilizing factors” intensified. A front-page commentary in the state-run China Information News today said that external risks are the biggest uncertainty for the Chinese economy in the second half of this year. ‘Stay Calm’ In Hong Kong, K.C. Chan, the secretary for financial services and the Treasury, told Bloomberg Television that investors should “stay calm” and not be “spooked by the market.” Market volatility may persist as investors monitor the sovereign-debt crisis and the risk of a “double-dip” recession in the U.S., he said. In Seoul, central bank official Min Sung Kee said that investors seem “too nervous” and are reacting “more than what I expected.” In a phone interview, Min, director general of the financial markets department, said that officials are “watching the markets 24 hours a day and we need to monitor the U.S. market more closely tonight.” Yields on 10-year Treasuries fell to a record low yesterday as investors sought a refuge amid speculation that European banks may lack sufficient capital. The U.S. economy may expand less than previously forecast in 2011 and 2012 because of potential “political paralysis” and fiscal tightening, Citigroup Inc. said. Citigroup cut its 2011 growth forecast to 1.6 percent from 1.7 percent and lowered a 2012 estimate to 2.1 percent from 2.7 percent, according to a report dated yesterday. To contact the reporters on this story: Toru Fujioka in Tokyo at tfujioka1@bloomberg.net; Kate Andersen Brower in Washington at kandersen7@bloomberg.net

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