MOSCOW (AFP) - British Finance Minister George Osborne on Saturday warned against "economic warfare" as the G-20 states of top world economies met, hoping to allay fears they could devalue national currencies to boost economic activity.

G-20 finance ministers at their meeting in Russia are later expected to adopt a statement in their communique broadly similar to that issued by the G-7 leading developed economies emphasising that markets alone should set currency exchange rates.

The worries had been set off by the policy of monetary easing to boost inflation and activity by reducing the value of the yen planned by the Japanese authorities under new Prime Minister Shinzo Abe.

"There was a very clear G-7 statement this week," Mr Osborne told reporters in Moscow. "You will see later today that the G-20 will echo what the G-7 has said."

"Currencies should not be used as a tool of competitive devaluation. The world should not make the mistake that it has made in the past of using currencies as the tools of economic warfare," the British Chancellor of the Exchequer added.

"A clear statement from the G-20 will help and I expect that to come later today," said Mr Osborne.

French Finance Minister Pierre Moscovici echoed his words, saying "we refuse to enter into any kind of currency war" while insisting that global policy makers take a "cooperative position" on the issue.

European capitals fear that devaluations of currencies like the yen would make their own exports less competitve and harm extremely fragile economic recoveries at home.

The G-7 group of the world's richest nations, including Japan, issued a statement on Tuesday to calm markets by declaring a commitment to "market-determined exchange rates".

The United States has urged the world to refrain from "competitive devaluation", a message echoed by the EU commission, France and Germany.