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Currency War Is Now a Dud as Windfall From Devaluations Vanishes
(Bloomberg) -- Currency wars, it turns out, may not be worth fighting right now.
While weaker exchange rates have at times throughout history helped stoke economic growth by making countries' exports cheaper, the benefits are becoming hard to find.
Nowhere is this more apparent than in developing nations, where currencies have slumped 24 percent on average against the dollar since 2011. Despite this, their annual export growth rate has slowed to 4 percent in the past four years from 8 percent during the previous decade, according to the CPB Netherlands Bureau for Economic Policy Analysis. In Brazil, the real's 48 percent plunge since the start of 2011 has done little to revive an economy heading for its worst performance in 25 years.
SNB says spent $27 billion to defend franc before dropping peg
(Reuters) - The Swiss National Bank (SNB) spent 25.8 billion Swiss francs ($26.91 billion) defending the currency late last year before abandoning its peg as too costly for the country's economy, it said on Thursday.
The SNB shocked markets in January when it removed the 1.20 per euro cap on the Swiss franc, sending the currency soaring, stocks plunging and sparking fears for Switzerland's export reliant economy.
The SNB has argued that it had to abandon the franc's three-year-old cap against the euro, but the decision is still reverberating, with politicians stepping up their criticism of the SNB as the economy falters in part due to the strong franc.
A Murky, Sloppy Muddle: How Greece's Exit From Euro Could Happen
(Bloomberg) -- With the fight to keep Greece in the euro now in its sixth year, everyone is running out of patience. More importantly, Prime Minister Alexis Tsipras's government in Athens is running out of money.
While bond yields suggest investors expect Greece to stay in the euro, economists such as UniCredit Bank AG's Erik Nielsen say it may be just a matter of time before he's forced to print a new currency.
Adopting the euro was always supposed to be a one-way ticket, so there is no legal precedent or political roadmap for an exit. If you're waiting for a formal announcement of a clear resolution, you may be waiting a long time.
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