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Currency war talk not appropriate - IMF chief economist
January 23, 2013 / 3:46 PM / 5 years ago

Currency war talk not appropriate - IMF chief economist

WASHINGTON, Jan 23 (Reuters) - 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.

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