Currency exchange rates back strongly to the forefront of market interest
GMT 7:03 2014 Monday, December 22
Paris: the collapse of the Russian ruble and the naira Nigerian to strict policies of the two banks of the central Swiss and Japanese, returning the issue of exchange rates to the fore strongly and with it fears and speculation currency war could be raging in 2015.lkn economists believe that no country can allow himself to run in open currency war , so I expect it will be a war with weapons is Tkulaidah.o »Currency War» is a race between countries that reduce non-stop Osalr interest to pay Asarsrv theircurrencies to decline in order to boost exports. It is a deeper phenomenon of violent and intermittent shocks associated with a decline in oil prices, which led to the collapse of the ruble week.
The results are cases of a sharp rise in inflation and destabilize the economy at large. The crisis of the thirties of the last century linked to the reduction of the currency began to pound sterling.
Summed «Economic Analysis Council», which includes experts advising the French government, the situation by saying that he «can not be a weak currency to everyone at one time. If the currency rises again dropped the price », adding that« the concept of currency war born of this calculation the fact that no race to reduce the value of a currency can only end badly ».
And dissemination of Nouriel Roubini, an economist who became famous prediction of the financial crisis in 2008, at the beginning of December this article entitled «Back Currency wars».
And verified the man in his article in the Japanese central bank's decision to enhance monetary easing policy, which followed in a move that surprised everyone, which led to a decline in the price of Alin.oiry Roubini it «strategy + each one works to his advantage + lead to reactions in Asia and around the world». He predicted that the implications for South Korea, direct competition for Japanese exports, which forced the central bank to cut interest rates twice during the six months to contain the won (Korean currency).
Since this article was published escalation of tension in the exchange markets, especially in emerging countries, which suffer from the effects of falling oil prices and fluctuations in the ruble prices and the collapse of the entire price of the Nigerian naira currency. In Turkey, the price of a pound to a historic low of H.ama single European currency (the euro) has lost since the beginning of the year more than ten percent of its value against the dollar after the announcements of the European Central Bank's monetary tightening policy violates Alamirkah.fa the other hand, is making strenuous efforts in Switzerland cope with the rising price of its currency. Central bank was forced on Thursday to take the unusual decision at all, which is the introduction of negative interest rates on bank deposits. That is, they impose a tax to stop the flow of capital as investors turn to the Swiss franc due to the weakness of other currencies.
But Anton Prendergast, chief economist at «Kandriam» group, did not see in all of this currency war, but defensive reactions and sporadic attacks. He said «We are in a very tense situation where no country can afford a big increase in the price of its currency, rather than a currency war», adding that this is the beginning of that «in advanced economies all interest rates, central banks no or virtually non-existent», ie, that the weapon Traditional devaluation is no longer available.
Non-traditional exercises remain a buy large quantities of stocks, as happened in the United States and being in Japan, was carried out by the European Central Bank. He «But lower interest rates will be slight impact». Even if the major European Central Bank exercises next year, waiting, do not expect any economist low euro rate Kthira.ama United States constitute an exception to its economy strong central its bank is ready to increase interest rates.
Many analysts believe that the evolution of exchange rates will be linked especially on the willingness of Americans to raise the price of their currency, which recorded an increase of 14 percent versus the yen since the beginning of the primary Am.walomr other is the price of oil. If down the left that will protect to some extent the trade balances of the consuming countries, and makes countries less vulnerable to fluctuations in exchange rates, but those producing countries that rely heavily on the export earnings of the black gold.
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