"There are good global frameworks for what is often described as a" currency war "or a downward monetary action," said Alan Ruskin, Deutsche Bank Global Head of G10 Foreign Exchange Strategy. Reuters city.
"Global conditions are well defined for what has been described as a" currency was "or a monetary race towards" the bottom "." – Deutsche Bank
– zerohedge June 12, 2019
Ruskin hints at the factors that boosted stock prices last week. A relaxed monetary policy on the part of the European Central Bank and the hope of the United States that the Fed may tighten a little less the reins.
The President of the United States is not indifferent either, he regularly criticizes the policy of the Fed via Twitter. A few days ago, he announced on Twitter that the euro and other currencies had been devalued against the dollar and that the United States was therefore a "big disadvantage".
The signs indicate that Ruskin is facing a devaluation competition. The different monetary regions continue to evaluate their currencies. This is due to the fact that central banks are flooding the economic zone with money (like the ECB with its monthly bond purchase).
Indeed, the euro and other currencies are devalued against the dollar, putting the US down. at a big disadvantage. The interest rate of the Fed is way too high, added to ridiculous quantitative tightening! They do not have a clue! https://t.co/0CpnUzJqB9
– Donald J. Trump (@realDonaldTrump) June 11, 2019
By devaluing their own currency, domestic products can be better sold abroad because they are cheaper compared to foreign currency. In return, foreign countries will devalue their own currency to offset this disadvantage. This comes to the downward spiral and therefore to the currency war.
If the value of its own currency continues to decline, the population would fledge into stable assets in value. Gold would probably be the first port of call, but even Bitcoin would be a big beneficiary. The price would multiply.
But let's go back to reality. There are currently only signs of such development. An escalation of the situation seems very unlikely. However, the fear of a currency war alone could bring down Bitcoin prices.
Notice of conflict of interest:
Börsenmedien AG Chairman and Chief Executive Officer, Bernd Förtsch, has received direct and indirect positions on the related financial instruments or derivatives mentioned in the publication, which benefit from the publication of any resulting price developments: Bitcoin .
The author, Marco Bernegg, holds direct positions on the subsequent financial instruments mentioned in the publication or related derivatives, which benefit from the publication of any resulting price developments: Bitcoin.