Too early to talk of forex war: FM
Reuters: London, Jan 31 2013, 03:57 IST
It is too early to say if Japan’s recent aggressive moves to weaken the yen constitute a currency war, but countries must resist falling into the trap of competitive devaluations, finance minister P Chidambaram said here.
Speaking to Reuters Television, Chidambaram said: “It’s still early to call this a currency war; only Japan has depreciated its currency. What choice does it have? They have to get growth up, they cannot continue with zero growth any longer.”
But Chidambaram said he was worried about the potential impact of any further competitive devaluations on India, which has Japan, China and other Asian states as major trade partners.
“I sincerely hope other countries do not get into competitive depreciation of their currencies,” Chidambaram said.
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