Economics
Specter of Currency Skirmishes Emerge With Central Bank Talk
- The dollar this week slumped to its weakest level in two years
- ECB, RBNZ and BOE are keeping door open for more policy easing
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Growing unease among global central banks about the slumping U.S. dollar has ignited speculation that a fresh currency war might be on the horizon.
European Central Bank official Philip Lane this week fired a warning shot, explicitly drawing attention to the exchange rate as the euro topped $1.20 for the first time in two years. Reserve Bank of New Zealand boss Adrian Orr was more circumspect about exchange rates, but nevertheless signaled he would ease monetary policy as necessary to stimulate growth. And other central banks from the U.K. to Japan also appear willing to loosen the spigots.