World leaders gathered for the Group of 20 summit neared an agreement that appears to paper over many of the differences

The agreement will likely reaffirm earlier language hashed out by finance ministers on letting markets determine foreign-exchange rates, without yielding specific new commitments from China to let its currency rise. It will pledge efforts to close the gap between countries with big trade surpluses and those with big deficits, but will likely stop short of numeric targets pushed by the U.S.

President Barack Obama urged the G-20 nations to stand firm against protectionism and called for a joint commitment to growth, part of an effort by U.S. officials to soften discord as the G-20 prepared for its meeting here beginning Thursday.

Even as the leaders meet, some emerging nations are erecting protective berms around their economies, as a torrent of capital pours in and threatens to derail their growth by sending their currencies soaring and hobbling their exporters. The Federal Reserve's recent plan to stimulate the U.S. economy by buying bonds has further frayed nerves, by threatening to undercut the dollar.

This week, Taiwan imposed limits on bond holdings by foreigners. In October, Brazil and Thailand raised taxes on foreign investment in local bonds. In June, South Korea restricted derivatives trading, while Indonesia limited investors from selling some short-term bonds.

Central banks from Israel to South Africa are buying dollars to keep their currencies from rising. China raised reserve requirements at banks this week, a move to slow foreign investment.

Mr. Obama's letter to other leaders came amid finger-pointing that threatened to overwhelm the summit. He reached Seoul Wednesday night for critical meetings Thursday, including with German Chancellor Angela Merkel, whose government has led criticism of U.S. dollar policy, and Chinese Premier Hu Jintao, who has resisted the president's push on China's currency.

U.S. officials say the depth of the discord has been overstated in the pressure-filled days before the summit. They hope emotions will ease if leaders endorse what their ministers previously agreed to.

'We think everyone is going to have an interest in lowering the temperature and defusing some of the tension by agreeing on a multilateral process for helping to resolve these pressures' on the global financial system, said Treasury Secretary Timothy Geithner.

A draft communique prepared Wednesday illustrated the G20 divisions. It said the nations would increasingly let markets determine currency rates, but officials remained undecided about how to discuss currency interventions. The draft said nations would 'refrain from competitive devaluation,' but in brackets was the alternative wording 'competitive undervaluation,' an apparent reference to China.

Officials indicated G-20 leaders would fudge the key issue of how to reduce global trade imbalances. Mr. Geithner said over the weekend that the summit likely wouldn't agree on targets for how large trade surpluses and trade deficits should be, a suggestion he had made earlier that drew opposition from Germany and others.

Instead, the G-20 may leave it to the International Monetary Fund to sort out, said Canadian Finance Minister Jim Flaherty. The IMF would report to G-20 finance ministers at their next meeting in February.

As originally conceived, at least by the U.S., this G-20 gathering was a chance to push China to allow its currency to rise more quickly. U.S. officials want countries with large surpluses, such as China, to consume more domestically and export less, which would help America save more domestically and export more.