Currency war : understanding the crisis that threatens the global economy

New thunderclap between the United States and China. While the american president Donald Trump has announced new tariffs on certain chinese products by the end

Currency war : understanding the crisis that threatens the global economy

New thunderclap between the United States and China. While the american president Donald Trump has announced new tariffs on certain chinese products by the end of the month of July, as China contends, in leaving it spinning its currency to mitigate the impact of sanctions. The chinese currency has reached since Monday, the symbolic milestone of 7 yuan to the dollar, its lowest level since 2008. Going blow for blow, the first two world powers seem to gradually enter into a new stage of trade war: a conflict of currencies. Explanations.

● How to define a currency war?

This is a situation in which two countries (or more) to devalue their currency in order to encourage the dynamism of the domestic industry and to promote their exports. The goal is to sell cheaper abroad to gain market share and to stimulate in turn the production. According to Stephane Deo, a strategist for Banque Postale Asset ...

Updated Date: 07 August 2019, 00:00

Kathleen Lees

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