Hank Paulson, US Treasury secretary, talked up the dollar in Osaka at the weekend as the Group of Eight finance ministers warned of the increasing threat inflation posed to their economies.

Taking their cue from tough comments from central bankers on inflation over the past two weeks, the G8 communiqué said: “Elevated commodity prices, especially of oil and food, pose a serious challenge to stable growth worldwide, have serious implications for the most vulnerable, and may increase global inflationary pressure.”