SEOUL - SOUTH Korean President Lee Myung-Bak has said that he was counting on 'peer pressure' instead of legally binding measures to police any currency deal made at the coming week's summit of the Group of 20.

In an interview with the Wall Street Journal published on Friday, he also said he did not believe Washington was engaged in competitive devaluation of its currency when it decided to pump extra money into US financial markets.

'There aren't any legal obligations,' Mr Lee was quoted as saying.

But he said the months of discussion among G-20 countries would produce 'a peer-pressure kind of effect on these countries' that violated the deal.

'There is a common understanding that if we do not work among ourselves, we fear we will return to protectionist measures' that will harm all the G-20 countries, said Mr Lee, who will chair the November 11-12 summit in Seoul.

Currency issues are likely to dominate the summit, as the United States has accused China of intentionally keeping its currency undervalued to benefit its exports.

'Peer pressure' to police deal