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Follow the Money

Brad Setser tracks cross-border flows, with a bit of macroeconomics thrown in.

Latest Post

A Follow-up on the Thai Baht

A quick follow up on yesterday’s post on the baht. One objection to highlighting Thailand in the coming foreign exchange report is that the baht has appreciated this year, and, well, to be a really bad actor, you have to be intervening to drive your currency down. That argument though fundamentally misses how most central banks currently act in the foreign exchange market to give their country a competitive edge. Read More

September 21, 2017

Thailand
Thailand: Currency Manipulator?

The Trump Administration seems to think of currency manipulation primarily as an issue with China. But “currency” actually is a much broader issue. Korea, Taiwan, and Singapore all have bigger current account surpluses, relative to their GDP, than China does. All have intervened to limit the appreciation of their currency within the past year. And all three have a long history of intervention, even if they intervened somewhat less when the dollar was exceptionally strong between the middle of 2014 and the middle of 2017.

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September 19, 2017

China
China's August Reserves

For the past fifteen or more years, if not longer, the flow of foreign exchange in and out of China has never quite seemed to balance. Either the yuan was a one way bet up, and the PBOC had to buy foreign exchange to keep the currency from appreciating, or the yuan was (thought) to be a one way bet down, and the PBOC had to sell a lot of foreign currency to keep the yuan from depreciating. Neither was an especially comfortable position for the central bank.

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September 15, 2017

Eurozone
The Global Cost of the Eurozone’s 2012 Fiscal Coordination Failure

The eurozone countries collectively did far too much fiscal adjustment in 2011, 2012, and 2013. Germany joined in the consolidation in 2012, hurting the eurozone—and the world.

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