Brazil threatens a fresh currency war

BRAZIL will continue to act to curb the strength of its currency, in a possible return to nationalist posturing over currency values not seen since last year.

Speaking at a conference in London yesterday, the country’s finance minister Guido Mantega said he could restrain excess speculation in the futures and derivatives markets in order to reign in over-valuation of exchange rates.

Last year, Mantega accused governments around the world of deliberately weakening their currencies to boost their export competitiveness, warning of an “international currency war”.

“The problem is that monetary policy in advanced economies is too relaxed. These countries are not recovering,” he said at the time.