IMF concerned about currency wars
As governments around the world looked to control the strength of their currencies and limit any upside, in order to assist economic growth, the IMF is concerned that we could be on the verge of a currency war. The US dollar is under serious pressure at the moment and the Chinese authorities are also uncomfortable with the strength of their currency. So are we on the verge of a currency war?
There is no doubt that a weak currency in the short-term does assist with exports making goods and services cheaper to those overseas. However, if we get into a situation where each currency continues to fall then ultimately this will impact upon the worldwide economy, trading patterns and could disrupt worldwide business for some time to come. As a consequence it seems as though currency fluctuations could be on the agenda the at the next IMF meeting which promises to be a rather lively affair.
Over the last few weeks we have seen various governments around the world jockeying for position with regards to their own benefits in the event of an economic upturn. However, this chase for business is having an impact upon currency rates which is not beneficial in the medium to longer term.
Share this..
Related stories
Pay increases slowing in April
Pay increases for UK workers appear to be moderating in April, new data suggests. New figures from payments specialists IRS show that during the first three months of this year the rate of pay increases stayed steady at three per cent. However, on the basis of 70 pay deals studied by the firm during April the rate has fallen to around three per cent. Sheila Atwood of IRS, said that the findings we...
Read MoreRate of advertising decline is slowing
While it would be wrong to say that the UK advertising market has in any way shape or form recovered, there are signs that the slowdown may be reducing in pace. The Daily Mail and General Trust (DMGT) today reported a 12% decline in revenues in the quarter ended June 2009 against a 23% fall in the previous quarter. Even though business is still under severe pressure, cost-cutting which was impleme...
Read MoreBritish manufacturing output increased in December
Amid all the doom and gloom surrounding the UK economy the Office for National Statistics today revealed a 0.9% increase in manufacturing output in December and an upwardly revised figure of 0.2% for November. These figures are way ahead of analyst expectations and would appear to show that the 0.1% increase in gross domestic product in the final quarter of 2009 could be revised higher. But can we...
Read MoreWill investment markets ever be the same again?
While we have been through many recessions and boom times in the UK and bounced back fairly quickly from the majority of them, there is a feeling that the scars left this time will take longer to heal. We have seen well known companies go out of business, we have seen banking systems collapse and over the next few months we will see a massive increase in the number of personal bankruptcies in the...
Read MoreScottish economy under pressure
A report from the Strathclyde University has poured scorn on suggestions that the Scottish economy will bounce back quicker than others in the UK. The report suggests that at the very best there will be zero economic growth in 2010 in Scotland and indeed the spectre of a possible return to recession has been mentioned. So why will Scotland lag the rest of the UK?
One of the main iss...