Currencies Lose Firepower as Trade Weapon
Financial Times (subscription)
When China’s central bank last week triggered the two biggest single-day falls in the renminbi since the 1990s, plenty of people were keen to proclaim a resumption of the “currency wars” that have been a feature of the global economy since the 2008 financial crisis. But if Beijing’s move prompted a predictable political response from veteran currency warriors in Washington and other capitals, it ignored what many trade economists see as an increasingly well-documented fact – currencies are not the trade weapon they once were.
China’s Devaluation May Be Bad News for FX Industry
China’s currency devaluation should give a shot in the arm to global foreign exchange volumes as traders take advantage of and protect themselves against the surprise surge in volatility, but its longer-term impact on market activity may not be so benign.
Rates to Rise Soon, says Bank of England Policymaker
Interest rates will rise “pretty soon”, Bank of England policymaker Prof David Miles has predicted – as he prepares to leave his role on the committee that takes the decision each month.
US CPI, FOMC Minutes to Offer Fed Timing Hints
It hasn’t been the busiest of weeks, with the combination of a light economic calendar and razor thin August trade playing a major part. Still, there is plenty of risk out there at the moment, with ongoing China uncertainty, a potential resurfacing in Greece troubles and the timing of Fed lift-off all capable of making waves.
Forward Books Compound EM Reserve Fall
Financial Times (subscriptiou)
The foreign exchange reserves cannily squirrelled away by emerging market nations have started to erode this year, as a host of countries have suffered capital outflows or used their treasure chests to help stem falls in their currency.