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Kayıt Tarihi: 13-Kasım-2019
Gönderilenler: 61
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| Gönderen: 21-Ekim-2020 Saat 20:56 | Kayıtlı IP
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Come to know about “currency war”!
After the 2008 financial crisis, the whole world is
afraid of whether there will be another financial crisis
similar to that of 2008. When the crisis really comes,
people are still unprepared and unable to deal with it.
What is the real danger？ The largest economy starts to
divide due to trading, the whole country was hit by
COVID-19. An uncoordinated policy response between
countries will prolong economic weakness and trigger a
new round of currency war.To get more news about
WikiFX, you can visit
wikifx official website.
Trade war, that means two or more countries have a
conflict of trade taxes with each other. Generally, a
country implements trade war in order to raise tariffs
against other countries and expand its own exports. If
the countries involved refused to compromise, they will
face further increase of export tariffs.
 04/637268831691214179/ART637268831691214179_415430.jpg-
wikifx_articlepic">
Currency war means that countries maximize their
benefits through their own currencies, usually by
devaluing their currencies to stimulate exports and gain
benefits from the exchange rate. When countries begin to
devalue their currencies competitively, global currency
wars and exchange rate wars will break out.
What's your leverage？
With the quantity of COVID-19 confirmed cases keep
raising, the market investors have an unprecedented sense
of urgency.
According to an analysis by MSIC, so far, global
stock markets have fallen nearly 20 percent as a result
of the spread of the COVID-19 epidemic and the collapse
in oil prices, and volatility is expected to soar to more
than 40 percent. It remains to be seen whether the crisis
will follow a pattern similar to that of the past.
Underthe epidemic, major central banks around the
world have begun to act.
The Fed cut interest rates by 50 bp and 100bp in a
row, lowered the target range of the federal funds rate
to 0- 0.25 percent, announced a new round of quantitative
easing (QE) of $700 billion and cut the discount rate for
emergency loans by 125bp. According to incomplete
statistics, in addition to the Federal Reserve, more than
a dozen central banks, including the Bank of Australia,
the Bank of Canada and the Bank of Korea, have also
entered the ranks of interest rate cuts.
Although the European Central Bank and the Bank of
Japan, which are already in negative interest rates, did
not cut interest rates further, they both stepped up
quantitative easing. The ECB added an additional 120
billion euros in asset purchases until the end of the
year, while the Bank of Japan announced an Y6,000bn
increase of its annual ETF purchase target to Y12
trillion and a raise of the Japanese real estate
investment trust (J-REITs) purchase target to Y180
billion.
It is worth noting that at present, a single monetary
policy is no longer enough to boost market confidence. At
present, the Fed is only one step away from negative
interest rates, and there is a lot of speculation that
the Fed will join the camp of negative interest rates in
the future. However, whether negative interest rates can
effectively boost the economy is still controversial, and
the policy has also been criticized by many parties. The
traditional monetary policy system, represented by the
Federal Reserve, has been in trouble. Although
extraordinary policy stimulus has become the norm, it
cannot fundamentally break the situation and will deepen
rather than alleviate the hidden risks.
Judging from the fiscal measures of major economies,
the US Congress has passed an $8.3 billion bill to deal
with the COVID-19 epidemic, and the Trump administration
is planning to launch a nearly $1,000bn economic stimulus
policy. Canada has also announced a new fiscal measure of
C$1.1 billion. South Korea's parliament approved a
supplementary budget of 11.7 trillion won to deal with
the impact of the epidemic on the economy and support
fragile businesses and domestic consumption.
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