ISTANBUL - The world economy is growing faster than expected, but the recovery remains "fragile" and threatened by rising unemployment, finance ministers from the Group of Seven rich countries said after they concluded their meeting Saturday.

They said in a joint statement that decisive actions had improved conditions for the economy and financial markets. But they warned "there is no room for complacency since the prospects for growth remain fragile and labour market conditions are not yet improving."

Stimulus measures such as government deficit spending and rock-bottom interest rates have helped the world economy bounce back from the deepest recession since the Second World War, and the International Monetary Fund this week urged governments to keep these in place until the recovery has been firmly established.

The finance ministers agreed they will keep support measures "until recovery is assured."

In a statement following the meeting, U.S. Treasury Secretary Timothy Geithner said the world's largest economy will unwind the extraordinary policy measures it has taken only when conditions stabilize and growth strengthens.

In the U.S., the Federal Reserve has slashed its key interest rate to near zero per cent and pumped over a trillion dollars into the markets to sustain liquidity and free up lending, while the Obama administration enacted a near $800 billion package of spending increases and tax cuts to prop up the economy.

The other G7 countries have done likewise, as has much of the developing world, and the result has been the faster than expected rebound in global economic growth. Earlier this week, the IMF said the recession in 2009 was going to be less severe than it believed just three months ago and raised its forecast for 2010 global growth to 3.1 per cent from 2.5 per cent, largely because of these stimulus measures.

The IMF warned that rising unemployment remained one of the key threats to growth next year, a view backed up by Geithner, who said unemployment was unacceptably high. Figures on Friday showed the U.S. economy shedding more jobs than expected in September, with unemployment at 9.8 per cent.

"Conditions for a sustained recovery, led by private demand, are not yet fully established," he said.

The G7 countries are the United States, Japan, Germany, France, Britain, Canada and Italy.

Its role has recently been overshadowed by the Group of 20, which includes developing economic powerhouses such as China, India and Brazil.

Last week the leaders of the G20 agreed that the bigger body would become the world's "premier" economic decision-making forum, raising questions about the future of the G7.

There was no reference to the future of the G7 in the communique Saturday, but French Finance Minister Christine Lagarde dismissed talk of its premature death.

"The G7's existence is fully justified," she said, even though she said that future meetings may not yield a communique at their conclusion.

"But it's still important for us to talk on issues of economy and finance," she said.

Elsewhere in the joint statement, the finance ministers reiterated their view that they will "continue to monitor exchange rates closely and co-operate as appropriate."

However, there was no reference to the dollar's recent weakness against a host of currencies. The dollar has fallen heavily in recent weeks, to an eight-month low against the yen, while the euro nearly hit a year-high against the dollar, prompting concerns that a dollar crisis could bring the world recovery to a grinding halt.

The only currency that was mentioned, as has become de rigeur in these statements, was the Chinese yuan, which is artificially set to the dollar by the Chinese authorities to keep Chinese exports cheap in U.S. markets.

Though the Chinese authorities have taken steps to allow their currency to rise against the dollar, it has not been far or fast enough for many.

"We reaffirmed the necessity for the Chinese currency to be appreciating," said Lagarde. "We think that we need to have a strong dollar ... and volatility is not welcome, and this is not just for the dollar but for all currencies," said Lagarde.