IMF warns against currency interventions to improve trade balance

IMF warns against currency interventions to improve trade balance

WASHINGTON (Reuters) – The International Monetary Fund on Wednesday warned against governments trying to weaken their currencies through monetary easing or market interventions, arguing in a blog post that this would hurt the functioning of the international monetary system and make all nations worse off.

The post, which comes as global central bankers are gathering this week in Jackson Hole, Wyoming, said that policy proposals to use monetary easing and direct purchases of other countries’ currencies are unlikely to work.

“One should not put too much stock in the view that easing monetary policy can weaken a country’s currency enough to bring a lasting improvement in its trade balance through expenditure switching. Monetary policy alone is unlikely to induce the large and persistent devaluations that are needed to bring that result,” IMF chief economist Gita Gopinath and IMF researchers Gustavo Adler and Luis Cubeddu said in the post.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.


Source : Reuters Link

Follow 3-www.NET
Follow
e-News.US
  
Share
e-News.Us



Category Latest Posts