PARIS - The Group of Seven nations is committed to taking coordinated action to ensure liquidity and to support financial market functioning, financial stability and economic growth, G7 finance ministers and central bank governors said in a statement.

"These actions, together with continuing fiscal discipline efforts will enable long-term fiscal sustainability," the statement released early on Monday said.

"No change in fundamentals warrants the recent financial tensions faced by Spain and Italy. We welcome the additional policy measures announced by Italy and Spain to strengthen fiscal discipline and underpin the recovery in economic activity and job creation," it added.

Senior officials conferred by phone before Asian financial markets opened as financial crises on both sides of the Atlantic threatened to escalate.

In separate efforts aimed at preventing panic, the European Central Bank signaled it would start buying Italian and Spanish debt, while US Treasury Secretary Timothy Geithner said Treasury securities are just as strong as they were before a potentially damaging debt downgrade by Standard & Poor's on Friday.

G7 officials said in their statement they would consult closely with regard to action in foreign exchange markets and would cooperate as appropriate on foreign exchange.

"Excess volatility and disorderly movements in exchange rates have adverse implications for economic and financial stability," they said.

Global policymakers held an emergency conference call on Sunday to discuss the twin debt crises in Europe and the United States that are causing market turmoil and stoking fears of the rich world sliding back into recession.

After a week that saw $2.5 trillion wiped off global stock markets, political leaders are under mounting pressure to reassure investors that Western governments have both the will and ability to reduce their huge and growing public debt loads.

South Korea said finance deputies from the Group of 20 (G20) major and emerging economies discussed the European debt crisis and the US sovereign rating downgrade on Sunday morning.

A Japanese government source said finance leaders from the Group of Seven (G7) developed economies would also discuss the crises and may issue a statement later.

The European Central Bank (ECB) was scheduled to hold a rare Sunday afternoon conference call. Investors are anxiously looking for the central bank to start buying Italian and Spanish debt on Monday to stabilize prices, a move that has split the ECB governing council.

In Washington, a White House economic adviser castigated ratings agency Standard and Poor's (S&P) for downgrading the US credit rating to AA+ from AAA, a move that over time could ripple through markets by pushing up borrowing costs and making it more difficult to secure a lasting recovery.

Washington's Asian allies rallied round the battered superpower, with Japan and South Korea both saying their trust in US Treasuries remained unshaken.