text: The only ceneral banks with a potentially unlimited supply of a currency are theones issuing it, and it is not €ven clear that the laws circumscribing theiraclivities rrourd today permit them to take a sufficiently firm posture, even actlngtogether. Moreover, the implication of intervention for monetary policy would bean lncrease in the money supply in countries whose currencies are to be depreciated and a reduction ln the money supply ln countries vrhose currencies are lo oeapprecialed. The risk of conflict betteen the objectives of exchange ratestabilization and monetary targets has to be carefully analysed. 38. At the meeting of the croup of Five in September 1995, key-currency countriesagreed that exchange rates shoul-d better reflect fundamental economic conditionsthan had been the case, and they discussed co-operation to achieve a smooth decltne^/ 40 /7 08 English Page II in dollar rates. Reducing nisaLignments of key currencies and establishi.ng qreater stability among them are essentially matters of co-operation anong ttle countrles. The issue is none the less of deep concern to other countries even if their roLe in thj.s regard is limited. Other aspects of the functioninq of the monetary system, especially long-tern ones. concern non-key-cu r rency countries directly and involve their policiest these aspects must be raised in larqer forums with general participati.on or perhaps in representalive ad hoc bodies, such as the committee of Tarenty on Reform of the InternalionaL Monetary Systen and Related fssues in the earlv I97Os. Although there is no necessary conflict bet\'reen key-currency co-operation in a smaLl group and discussions in larger bod!'es' it seems approPrlate to deliberate how different approaches could best be combined so as to ensure efficient and r.rorkable arrangements in nhich the i.nterests of all countries vrould be fully taken into account. 2. Interna tiona 1 liquiditY 39. The expansion and contraction of international liquidi.ty no$t depends crucially on the behaviour of private internalional capital markets and in particul.ar on the
analysis: The text appears to be discussing monetary policy, exchange rates, and international cooperation, which suggests that it is related to economic issues. The text mentions key-currency countries, exchange rate stabilization, and monetary targets, indicating that it is focused on macroeconomic policy rather than a specific industry or sector. The language used is technical and formal, suggesting that the text is intended for an audience with a background in economics or finance.