Harvard economist Jeffrey Frankel on the ‘currency manipulation’ debate:
“Even if one
accepts that it is possible to identify currency manipulation, China no longer
qualifies. Under recent conditions, if China allowed the renminbi to float
freely, without intervention, it would be more likely to depreciate than rise
against the dollar, making it harder for US producers to compete in
international markets.
…
Those who charge
Japan or the eurozone with pursuing currency wars have in mind the renewed
monetary stimulus implied by their central banks' recent quantitative easing
programs. But, as the US government knows well, countries with faltering
economies cannot be asked to refrain from lowering interest rates just because
the likely effects include currency depreciation.
Indeed, it was the
US that had to explain to the world that monetary stimulus is not currency
manipulation when it undertook quantitative easing in 2010. At the time,
Brazilian Finance Minister Guido Mantega coined the phrase “currency wars"
and accused the US of being the main aggressor.”