Currency Wars Yesterday and Today

An energetic debate on the danger of a global currency war has flared up in recent months, stoked by a renewed move to 'quantitative easing' in the United States, resurgent capital flows to developing countries and strong upward pressure...

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Main Authors:	Brahmbhatt, Milan, Canuto, Otaviano, Ghosh, Swati
Format:	Brief
Language:	English
Published:	World Bank, Washington, DC 2012
Subjects:	ADMINISTRATIVE CONTROLS ADVANCED COUNTRY AGGREGATE DEMAND ASYMMETRIC INFORMATION AUTONOMOUS MONETARY POLICY BALANCE OF PAYMENTS BANKING SECTOR BANKRUPTCIES BOND BOND SPREADS BOND YIELDS CAPITAL ALLOCATION CAPITAL CONTROL CAPITAL CONTROLS CAPITAL FLOWS CAPITAL INFLOWS CAPITAL MARKETS CENTRAL BANK CENTRAL BANKS COLLATERAL COMPETITIVE DEVALUATION COMPETITIVE DEVALUATIONS COMPETITIVENESS CONSUMER PRICE INFLATION CORE INFLATION CORPORATE PROFITS CREDIBILITY CREDIT RATIONING CREDIT SPREADS CREDITORS CURRENCY CURRENT ACCOUNT CURRENT ACCOUNT DEFICIT DEBT DEBTS DEFLATION DEPRESSION DEVELOPING COUNTRIES DEVELOPING ECONOMIES DEVELOPMENT STRATEGY DISINFLATION DOMESTIC BONDS DOMESTIC DEMAND DOMESTIC INTEREST RATES ECONOMIC CRISIS ECONOMIC HISTORY ECONOMIC OUTLOOK ECONOMIC REVIEW EMERGING MARKET EMERGING-MARKET EXCHANGE RATE EXCHANGE RATE FLEXIBILITY EXPORTS EXTERNAL BORROWING FEDERAL RESERVE FEDERAL RESERVE BANK FINANCIAL DISTRESS FINANCIAL FRAGILITY FINANCIAL INSTITUTIONS FINANCIAL MARKETS FINANCIAL SECTOR FINANCIAL STABILITY FISCAL POLICY FIXED EXCHANGE RATE FIXED EXCHANGE RATE PEG FIXED EXCHANGE RATE REGIME FLEXIBLE EXCHANGE RATE FLEXIBLE EXCHANGE RATES FOREIGN EXCHANGE FOREIGN EXCHANGE MARKET FULL EMPLOYMENT GDP GLOBAL CURRENCY GLOBAL DEMAND GLOBAL ECONOMY GLOBAL FINANCIAL STABILITY GLOBAL IMBALANCES GLOBAL TRADE GLOBALIZATION GOLD GOLD STANDARD GOVERNMENT BONDS GOVERNMENT SECURITIES GROSS DOMESTIC PRODUCT GROWTH POLICY GROWTH POTENTIAL GROWTH VOLATILITY HIGH INFLATION IMBALANCES IMPLICIT SUBSIDY IMPORT INDEPENDENT MONETARY POLICIES INDEPENDENT MONETARY POLICY INFLATION EXPECTATIONS INFLATION RATE INFLATIONARY EXPECTATIONS INFLATIONARY PRESSURES INSTRUMENT INSURANCE INSURANCE POLICY INTEREST RATE INTEREST RATE SPREADS INTERNATIONAL FINANCIAL INTEGRATION INTERNATIONAL MARKETS LIBERALIZATION LIBERALIZATIONS LIMITED EXCHANGE RATE FLEXIBILITY LIQUIDITY LOCAL MARKETS LONG-TERM GOVERNMENT SECURITIES LONG-TERM INTEREST LONG-TERM INTEREST RATES LOSS OF COMPETITIVENESS MACRO POLICY MACROECONOMIC POLICIES MACROECONOMIC POLICY MARKET COUNTRIES MATURITIES MATURITY MATURITY STRUCTURE MONETARY AUTONOMY MONETARY ECONOMICS MONETARY FUND MONETARY POLICY MONETARY POLICY AUTONOMY MONEY GROWTH MONEY SUPPLY MULTILATERAL TRADE NOMINAL INTEREST RATE NOMINAL INTEREST RATES OPEN CAPITAL ACCOUNT OPEN CAPITAL ACCOUNTS OUTPUT OUTPUT GAPS POLICY OPTIONS POLICY REFORM POLICY RESPONSE POLITICAL ECONOMY POTENTIAL OUTPUT POVERTY REDUCTION PRICE STABILITY PROTECTIONISM REAL EXCHANGE REAL EXCHANGE RATE REAL EXCHANGE RATES REAL GROSS DOMESTIC PRODUCT REAL INTEREST REAL INTEREST RATES RECESSION REGULATORY REFORM RESERVE REQUIREMENTS RETURN SAFETY NETS SHORT-TERM INTEREST RATE SHORTFALL SPECULATIVE BUBBLES STRUCTURAL POLICIES TAX TRADABLE GOODS TRADE DEFICIT TRADE POLICY TRADING TRADING PARTNERS TREASURY TREASURY BONDS UNEMPLOYMENT UPWARD PRESSURE VOLATILITY VOLUME OF FLOWS WAGES WORLD TRADE
Online Access:	http://documents.worldbank.org/curated/en/2010/12/13216674/currency-wars-yesterday-today http://hdl.handle.net/10986/10116

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spelling	okr-10986-101162021-04-23T14:02:48Z Currency Wars Yesterday and Today Brahmbhatt, Milan Canuto, Otaviano Ghosh, Swati ADMINISTRATIVE CONTROLS ADVANCED COUNTRY AGGREGATE DEMAND ASYMMETRIC INFORMATION AUTONOMOUS MONETARY POLICY BALANCE OF PAYMENTS BANKING SECTOR BANKRUPTCIES BOND BOND SPREADS BOND YIELDS CAPITAL ALLOCATION CAPITAL CONTROL CAPITAL CONTROLS CAPITAL FLOWS CAPITAL INFLOWS CAPITAL MARKETS CENTRAL BANK CENTRAL BANKS COLLATERAL COMPETITIVE DEVALUATION COMPETITIVE DEVALUATIONS COMPETITIVENESS CONSUMER PRICE INFLATION CORE INFLATION CORPORATE PROFITS CREDIBILITY CREDIT RATIONING CREDIT SPREADS CREDITORS CURRENCY CURRENT ACCOUNT CURRENT ACCOUNT DEFICIT DEBT DEBTS DEFLATION DEPRESSION DEVELOPING COUNTRIES DEVELOPING ECONOMIES DEVELOPMENT STRATEGY DISINFLATION DOMESTIC BONDS DOMESTIC DEMAND DOMESTIC INTEREST RATES ECONOMIC CRISIS ECONOMIC HISTORY ECONOMIC OUTLOOK ECONOMIC REVIEW EMERGING MARKET EMERGING-MARKET EXCHANGE RATE EXCHANGE RATE FLEXIBILITY EXPORTS EXTERNAL BORROWING FEDERAL RESERVE FEDERAL RESERVE BANK FINANCIAL DISTRESS FINANCIAL FRAGILITY FINANCIAL INSTITUTIONS FINANCIAL MARKETS FINANCIAL SECTOR FINANCIAL STABILITY FISCAL POLICY FIXED EXCHANGE RATE FIXED EXCHANGE RATE PEG FIXED EXCHANGE RATE REGIME FLEXIBLE EXCHANGE RATE FLEXIBLE EXCHANGE RATES FOREIGN EXCHANGE FOREIGN EXCHANGE MARKET FULL EMPLOYMENT GDP GLOBAL CURRENCY GLOBAL DEMAND GLOBAL ECONOMY GLOBAL FINANCIAL STABILITY GLOBAL IMBALANCES GLOBAL TRADE GLOBALIZATION GOLD GOLD STANDARD GOVERNMENT BONDS GOVERNMENT SECURITIES GROSS DOMESTIC PRODUCT GROWTH POLICY GROWTH POTENTIAL GROWTH VOLATILITY HIGH INFLATION IMBALANCES IMPLICIT SUBSIDY IMPORT INDEPENDENT MONETARY POLICIES INDEPENDENT MONETARY POLICY INFLATION EXPECTATIONS INFLATION RATE INFLATIONARY EXPECTATIONS INFLATIONARY PRESSURES INSTRUMENT INSURANCE INSURANCE POLICY INTEREST RATE INTEREST RATE SPREADS INTERNATIONAL FINANCIAL INTEGRATION INTERNATIONAL MARKETS LIBERALIZATION LIBERALIZATIONS LIMITED EXCHANGE RATE FLEXIBILITY LIQUIDITY LOCAL MARKETS LONG-TERM GOVERNMENT SECURITIES LONG-TERM INTEREST LONG-TERM INTEREST RATES LOSS OF COMPETITIVENESS MACRO POLICY MACROECONOMIC POLICIES MACROECONOMIC POLICY MARKET COUNTRIES MATURITIES MATURITY MATURITY STRUCTURE MONETARY AUTONOMY MONETARY ECONOMICS MONETARY FUND MONETARY POLICY MONETARY POLICY AUTONOMY MONEY GROWTH MONEY SUPPLY MULTILATERAL TRADE NOMINAL INTEREST RATE NOMINAL INTEREST RATES OPEN CAPITAL ACCOUNT OPEN CAPITAL ACCOUNTS OUTPUT OUTPUT GAPS POLICY OPTIONS POLICY REFORM POLICY RESPONSE POLITICAL ECONOMY POTENTIAL OUTPUT POVERTY REDUCTION PRICE STABILITY PROTECTIONISM REAL EXCHANGE REAL EXCHANGE RATE REAL EXCHANGE RATES REAL GROSS DOMESTIC PRODUCT REAL INTEREST REAL INTEREST RATES RECESSION REGULATORY REFORM RESERVE REQUIREMENTS RETURN SAFETY NETS SHORT-TERM INTEREST RATE SHORTFALL SPECULATIVE BUBBLES STRUCTURAL POLICIES TAX TRADABLE GOODS TRADE DEFICIT TRADE POLICY TRADING TRADING PARTNERS TREASURY TREASURY BONDS UNEMPLOYMENT UPWARD PRESSURE VOLATILITY VOLUME OF FLOWS WAGES WORLD TRADE An energetic debate on the danger of a global currency war has flared up in recent months, stoked by a renewed move to 'quantitative easing' in the United States, resurgent capital flows to developing countries and strong upward pressure on emerging market currencies. This economic premise views some of the arguments and concludes that the current United States monetary easing is a useful insurance policy against the risk of global deflation. But it is increasing pressure on developing countries to move toward greater monetary policy autonomy and exchange rate flexibility, as well as to undertake the institutional and structural policies needed to underpin such flexibility. Such reforms will take time. 2012-08-13T10:27:58Z 2012-08-13T10:27:58Z 2010-12 http://documents.worldbank.org/curated/en/2010/12/13216674/currency-wars-yesterday-today http://hdl.handle.net/10986/10116 English Economic Premise; No. 43 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research :: Brief Publications & Research
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English
topic	ADMINISTRATIVE CONTROLS ADVANCED COUNTRY AGGREGATE DEMAND ASYMMETRIC INFORMATION AUTONOMOUS MONETARY POLICY BALANCE OF PAYMENTS BANKING SECTOR BANKRUPTCIES BOND BOND SPREADS BOND YIELDS CAPITAL ALLOCATION CAPITAL CONTROL CAPITAL CONTROLS CAPITAL FLOWS CAPITAL INFLOWS CAPITAL MARKETS CENTRAL BANK CENTRAL BANKS COLLATERAL COMPETITIVE DEVALUATION COMPETITIVE DEVALUATIONS COMPETITIVENESS CONSUMER PRICE INFLATION CORE INFLATION CORPORATE PROFITS CREDIBILITY CREDIT RATIONING CREDIT SPREADS CREDITORS CURRENCY CURRENT ACCOUNT CURRENT ACCOUNT DEFICIT DEBT DEBTS DEFLATION DEPRESSION DEVELOPING COUNTRIES DEVELOPING ECONOMIES DEVELOPMENT STRATEGY DISINFLATION DOMESTIC BONDS DOMESTIC DEMAND DOMESTIC INTEREST RATES ECONOMIC CRISIS ECONOMIC HISTORY ECONOMIC OUTLOOK ECONOMIC REVIEW EMERGING MARKET EMERGING-MARKET EXCHANGE RATE EXCHANGE RATE FLEXIBILITY EXPORTS EXTERNAL BORROWING FEDERAL RESERVE FEDERAL RESERVE BANK FINANCIAL DISTRESS FINANCIAL FRAGILITY FINANCIAL INSTITUTIONS FINANCIAL MARKETS FINANCIAL SECTOR FINANCIAL STABILITY FISCAL POLICY FIXED EXCHANGE RATE FIXED EXCHANGE RATE PEG FIXED EXCHANGE RATE REGIME FLEXIBLE EXCHANGE RATE FLEXIBLE EXCHANGE RATES FOREIGN EXCHANGE FOREIGN EXCHANGE MARKET FULL EMPLOYMENT GDP GLOBAL CURRENCY GLOBAL DEMAND GLOBAL ECONOMY GLOBAL FINANCIAL STABILITY GLOBAL IMBALANCES GLOBAL TRADE GLOBALIZATION GOLD GOLD STANDARD GOVERNMENT BONDS GOVERNMENT SECURITIES GROSS DOMESTIC PRODUCT GROWTH POLICY GROWTH POTENTIAL GROWTH VOLATILITY HIGH INFLATION IMBALANCES IMPLICIT SUBSIDY IMPORT INDEPENDENT MONETARY POLICIES INDEPENDENT MONETARY POLICY INFLATION EXPECTATIONS INFLATION RATE INFLATIONARY EXPECTATIONS INFLATIONARY PRESSURES INSTRUMENT INSURANCE INSURANCE POLICY INTEREST RATE INTEREST RATE SPREADS INTERNATIONAL FINANCIAL INTEGRATION INTERNATIONAL MARKETS LIBERALIZATION LIBERALIZATIONS LIMITED EXCHANGE RATE FLEXIBILITY LIQUIDITY LOCAL MARKETS LONG-TERM GOVERNMENT SECURITIES LONG-TERM INTEREST LONG-TERM INTEREST RATES LOSS OF COMPETITIVENESS MACRO POLICY MACROECONOMIC POLICIES MACROECONOMIC POLICY MARKET COUNTRIES MATURITIES MATURITY MATURITY STRUCTURE MONETARY AUTONOMY MONETARY ECONOMICS MONETARY FUND MONETARY POLICY MONETARY POLICY AUTONOMY MONEY GROWTH MONEY SUPPLY MULTILATERAL TRADE NOMINAL INTEREST RATE NOMINAL INTEREST RATES OPEN CAPITAL ACCOUNT OPEN CAPITAL ACCOUNTS OUTPUT OUTPUT GAPS POLICY OPTIONS POLICY REFORM POLICY RESPONSE POLITICAL ECONOMY POTENTIAL OUTPUT POVERTY REDUCTION PRICE STABILITY PROTECTIONISM REAL EXCHANGE REAL EXCHANGE RATE REAL EXCHANGE RATES REAL GROSS DOMESTIC PRODUCT REAL INTEREST REAL INTEREST RATES RECESSION REGULATORY REFORM RESERVE REQUIREMENTS RETURN SAFETY NETS SHORT-TERM INTEREST RATE SHORTFALL SPECULATIVE BUBBLES STRUCTURAL POLICIES TAX TRADABLE GOODS TRADE DEFICIT TRADE POLICY TRADING TRADING PARTNERS TREASURY TREASURY BONDS UNEMPLOYMENT UPWARD PRESSURE VOLATILITY VOLUME OF FLOWS WAGES WORLD TRADE
spellingShingle	ADMINISTRATIVE CONTROLS ADVANCED COUNTRY AGGREGATE DEMAND ASYMMETRIC INFORMATION AUTONOMOUS MONETARY POLICY BALANCE OF PAYMENTS BANKING SECTOR BANKRUPTCIES BOND BOND SPREADS BOND YIELDS CAPITAL ALLOCATION CAPITAL CONTROL CAPITAL CONTROLS CAPITAL FLOWS CAPITAL INFLOWS CAPITAL MARKETS CENTRAL BANK CENTRAL BANKS COLLATERAL COMPETITIVE DEVALUATION COMPETITIVE DEVALUATIONS COMPETITIVENESS CONSUMER PRICE INFLATION CORE INFLATION CORPORATE PROFITS CREDIBILITY CREDIT RATIONING CREDIT SPREADS CREDITORS CURRENCY CURRENT ACCOUNT CURRENT ACCOUNT DEFICIT DEBT DEBTS DEFLATION DEPRESSION DEVELOPING COUNTRIES DEVELOPING ECONOMIES DEVELOPMENT STRATEGY DISINFLATION DOMESTIC BONDS DOMESTIC DEMAND DOMESTIC INTEREST RATES ECONOMIC CRISIS ECONOMIC HISTORY ECONOMIC OUTLOOK ECONOMIC REVIEW EMERGING MARKET EMERGING-MARKET EXCHANGE RATE EXCHANGE RATE FLEXIBILITY EXPORTS EXTERNAL BORROWING FEDERAL RESERVE FEDERAL RESERVE BANK FINANCIAL DISTRESS FINANCIAL FRAGILITY FINANCIAL INSTITUTIONS FINANCIAL MARKETS FINANCIAL SECTOR FINANCIAL STABILITY FISCAL POLICY FIXED EXCHANGE RATE FIXED EXCHANGE RATE PEG FIXED EXCHANGE RATE REGIME FLEXIBLE EXCHANGE RATE FLEXIBLE EXCHANGE RATES FOREIGN EXCHANGE FOREIGN EXCHANGE MARKET FULL EMPLOYMENT GDP GLOBAL CURRENCY GLOBAL DEMAND GLOBAL ECONOMY GLOBAL FINANCIAL STABILITY GLOBAL IMBALANCES GLOBAL TRADE GLOBALIZATION GOLD GOLD STANDARD GOVERNMENT BONDS GOVERNMENT SECURITIES GROSS DOMESTIC PRODUCT GROWTH POLICY GROWTH POTENTIAL GROWTH VOLATILITY HIGH INFLATION IMBALANCES IMPLICIT SUBSIDY IMPORT INDEPENDENT MONETARY POLICIES INDEPENDENT MONETARY POLICY INFLATION EXPECTATIONS INFLATION RATE INFLATIONARY EXPECTATIONS INFLATIONARY PRESSURES INSTRUMENT INSURANCE INSURANCE POLICY INTEREST RATE INTEREST RATE SPREADS INTERNATIONAL FINANCIAL INTEGRATION INTERNATIONAL MARKETS LIBERALIZATION LIBERALIZATIONS LIMITED EXCHANGE RATE FLEXIBILITY LIQUIDITY LOCAL MARKETS LONG-TERM GOVERNMENT SECURITIES LONG-TERM INTEREST LONG-TERM INTEREST RATES LOSS OF COMPETITIVENESS MACRO POLICY MACROECONOMIC POLICIES MACROECONOMIC POLICY MARKET COUNTRIES MATURITIES MATURITY MATURITY STRUCTURE MONETARY AUTONOMY MONETARY ECONOMICS MONETARY FUND MONETARY POLICY MONETARY POLICY AUTONOMY MONEY GROWTH MONEY SUPPLY MULTILATERAL TRADE NOMINAL INTEREST RATE NOMINAL INTEREST RATES OPEN CAPITAL ACCOUNT OPEN CAPITAL ACCOUNTS OUTPUT OUTPUT GAPS POLICY OPTIONS POLICY REFORM POLICY RESPONSE POLITICAL ECONOMY POTENTIAL OUTPUT POVERTY REDUCTION PRICE STABILITY PROTECTIONISM REAL EXCHANGE REAL EXCHANGE RATE REAL EXCHANGE RATES REAL GROSS DOMESTIC PRODUCT REAL INTEREST REAL INTEREST RATES RECESSION REGULATORY REFORM RESERVE REQUIREMENTS RETURN SAFETY NETS SHORT-TERM INTEREST RATE SHORTFALL SPECULATIVE BUBBLES STRUCTURAL POLICIES TAX TRADABLE GOODS TRADE DEFICIT TRADE POLICY TRADING TRADING PARTNERS TREASURY TREASURY BONDS UNEMPLOYMENT UPWARD PRESSURE VOLATILITY VOLUME OF FLOWS WAGES WORLD TRADE Brahmbhatt, Milan Canuto, Otaviano Ghosh, Swati Currency Wars Yesterday and Today
relation	Economic Premise; No. 43
description	An energetic debate on the danger of a global currency war has flared up in recent months, stoked by a renewed move to 'quantitative easing' in the United States, resurgent capital flows to developing countries and strong upward pressure on emerging market currencies. This economic premise views some of the arguments and concludes that the current United States monetary easing is a useful insurance policy against the risk of global deflation. But it is increasing pressure on developing countries to move toward greater monetary policy autonomy and exchange rate flexibility, as well as to undertake the institutional and structural policies needed to underpin such flexibility. Such reforms will take time.
format	Publications & Research :: Brief
author	Brahmbhatt, Milan Canuto, Otaviano Ghosh, Swati
author_facet	Brahmbhatt, Milan Canuto, Otaviano Ghosh, Swati
author_sort	Brahmbhatt, Milan
title	Currency Wars Yesterday and Today
title_short	Currency Wars Yesterday and Today
title_full	Currency Wars Yesterday and Today
title_fullStr	Currency Wars Yesterday and Today
title_full_unstemmed	Currency Wars Yesterday and Today
title_sort	currency wars yesterday and today
publisher	World Bank, Washington, DC
publishDate	2012
url	http://documents.worldbank.org/curated/en/2010/12/13216674/currency-wars-yesterday-today http://hdl.handle.net/10986/10116
_version_	1764411908206624768

Currency Wars Yesterday and Today

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