The American Empire in a Changing World


Friday, July 27, 2012

Australia: ''No escape from currency wars''

From AFR

''There is a war raging across global financial markets, which Australia has – so far at least – tried to avoid participating in. But the sounds of battle are growing and we may soon have no choice but to deploy our own weaponry. If so, it would be good news for our hard-pressed trade-exposed sectors such as mining and tourism, and potentially even homeowners and small businesses nursing large debts.

The battle is, of course, the global currency wars.

Desperate to breathe life into their moribund economies, central banks in Europe, Japan and the United States have cut interest rates to the bone and cranked up their monetary printing presses, which indirectly has helped weaken their currencies. Even China has recently started to allow its currency to fall against the US dollar, and it has also fallen against the Australian dollar.''

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