WASHINGTON Jan 23 The chief economist at the
International Monetary Fund on Wednesday shot down the notion
that easy monetary and fiscal policies in advanced economies
risk sparking a "currency war", saying there has not been a
major surge of capital into emerging nations.
"I think this increasing talk of currency wars is very much
overblown," IMF chief economist Olivier Blanchard said at a news
conference. "Countries have to take the right measures to get
their own economies back to health ... (and) to the extent we
think the policies are appropriate, then the implications in
terms of exchange rates are also appropriate."
Blanchard disputed the general notion that there has been a
sharp step up of capital flows into emerging markets that could
risk overheating those economies or fueling asset price bubbles.
"They basically have continued to be volatile but there is no
sea change in the recent past," he said.
"I think really the talk of currency wars is just
inappropriate at this point," Blanchard said.