Writing in the Financial Times, Zoellick called for a "Bretton Woods II" system of floating currencies as a successor to the Bretton Woods fixed-exchange rate regime that broke down in the early 1970s.
Gold briefly hit a record high of $1398,35 an ounce in early trade on Monday on concerns of a continued weakening dollar trend after the US Federal Reserve last week acted to resume buying Treasuries. That policy has fed acrimony among leading economies in the Group of 20 in the run-up to their summit in Seoul today and tomorrow. China and Germany, major exporting nations, have both decried the Fed's quantitative easing - effectively printing money - which is weakening the dollar.Investors are pumping dollars into emerging markets in search of higher yields, and the potentially destabilising impact of this, along with big current account deficits and surpluses as well as China's reluctance to let the yuan appreciate faster, are set to dominate the G20 debate.
