Swiss National Bank under attack

Michael J Lamla, Jan-Egbert Sturm 09 November 2012

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After the international uproar had abated over the policy adopted by the Swiss National Bank (SNB) in the first half of 2012, a certain level of sympathy for the situation in Switzerland had remained, Yet, the SNB has yet again been confronted with another barrage of accusations; Standard & Poor’s led the charge, accusing the SNB of exacerbating the crisis in the Eurozone by pegging the franc to the euro. The SNB stands accused of currency manipulation as part of an ongoing ‘currency war’.

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Topics:  Europe's nations and regions Exchange rates Monetary policy

Tags:  monetary policy, exchange rate policy, Eurozone crisis

Great expectations: (Competing) domestic drivers of Chinese policy deliberations

Shaun Breslin 16 April 2010

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Although China is a one-party state, this does not mean that China's leaders are free to do whatever they want. To be sure, compared to other countries, the level of organisation and control from the top is indeed very strong; and China's leaders do not exactly shy away from presenting themselves as being “in control”.

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Topics:  Exchange rates International trade

Tags:  global imbalances, China, exchange rate policy

Is China's currency undervalued?

Helmut Reisen 16 April 2010

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Most economists agree that allowing global current account imbalances, notably the US deficit and the Chinese surplus, and their accompanying capital flows to accumulate contributed to the over-leveraging and under-pricing of risk that triggered the crisis. This was recognised at the Pittsburgh Summit in September 2009 where the G20 leaders announced the creation of a new framework to coordinate and monitor national economic policies in order to reduce global imbalances and prevent them from building up in the future.

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Topics:  Exchange rates Global crisis

Tags:  global imbalances, renminbi, exchange rate policy

The China syndrome on exchange rates

Mohamed Ariff 19 February 2010

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There is no need to belabour the point that flexible prices play a key role in correcting imbalances, be they between supply and demand for products, or between saving and investment or, for that matter, global imbalances of international capital or trade flows. This is simply the magic of the price mechanism in textbooks.

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Topics:  Exchange rates

Tags:  global imbalances, China, exchange rate policy