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Currencies in sentence

1239 examples of Currencies in a sentence

Some countries devalued their currencies.
Moreover, the eurozone itself is a mini-gold standard, with heavily indebted members unable to devalue their currencies, because they have no currencies to devalue.
Lately, many emerging-market currencies have slid sharply, increasing the cost of servicing external dollar debts.
Without the ability to devalue their currencies, the only recourse the eurozone’s persistent debtors have is to threaten to leave the single currency.
This is a matter of considerable importance to central banks, which value liquidity when deciding which currencies to hold as reserve.
The last challenge can be stated as a question that is rarely posed: Is China’s political system an obstacle to renminbi internationalization?The pound sterling and the dollar, the principal international and reserve currencies of the nineteenth and twentieth centuries respectively, were issued by democracies.
Since the early nineteenth century, the leading international currencies have been those of countries with democratic political systems, where arbitrary official action is constrained and creditors are well represented.
A second insight from the case of the eurozone, advanced by the economist Paul de Grauwe, is that currency unions can be prone to self-reinforcing liquidity crises, because some vulnerable parts (Greece, Spain, Portugal, and Italy at various points) lack their own currencies.
This has meant either a decline in asset prices quoted in dollars or in dollars quoted in other currencies.
Meanwhile, capital is flooding into the higher-interest-rate emerging markets, causing inflationary pressures, driving up asset prices, and subjecting currencies to competitiveness-threatening appreciation – in short, distortions and policy headaches that require unconventional, defensive responses.
Imagine that there was no euro and that the southern countries had retained their own currencies – Italy with the lira, Spain with the peseta, Greece with the drachma, and so on.
If the European periphery countries had their own currencies, it is likely that debt problems would morph right back into elevated inflation.
To be sure, other countries that relied on exports to grow rapidly – such as Germany, Japan, and South Korea – eventually had to let their currencies appreciate.
Their borrowing costs fell as they locked their currencies into a union with countries – Germany, in particular – with a stronger reputation for stability.
One way that China is attempting to find out is by pushing to have the renminbi added to the basket of currencies that determine the value of the International Monetary Fund’s reserve asset, the Special Drawing Right (SDR).
But it is becoming increasingly difficult for factories in the region to remain in business under conditions of weak global demand and strong local currencies.
No other major established international currencies currently compete for global leadership.
The Bretton Woods system came to an end in March 1973, when the dollar and other major currencies were allowed to float and the dollar depreciated further.
This consensus has been maintained through a long period in which exchange rates between the major Western currencies have been allowed to find their own level.
Indeed, if we had to choose only one reason to explain why the crisis did not hit emerging markets harder than advanced economies (as we would have expected), it is that the former had most of their assets in dollars and most of their liabilities in their domestic currencies.
But, while the size of the FX business always grabs headlines, the way that currencies are traded also matters – and this has evolved mightily over the years.
Partly for these reasons, using currencies to hedge overall portfolios, or to have exposures that are related to other asset markets, has become increasingly popular.
Some of the more important examples of how currencies have become hedges involve the yen.
Low Japanese rates led to a “search for yield” by Japanese investors who increasingly invested their savings in foreign currencies, where they received higher interest rates: the famous “FX carry trade.”
Indeed, economic theory suggests that the interest-rate differential should be offset on average by depreciation of the currency with the higher interest rate, the differential thus reflecting the compensation required by investors to hold money in relatively risky currencies.
And in the period prior to the financial crisis, the yen depreciated against most currencies, as well as having lower interest rates, so borrowing in yen and investing in high-interest-rate currencies such as the Australian dollar or the Turkish lira was very profitable.
This led to increased flows into the carry trade, which for a while increased its success, because higher inflows tended to exacerbate the weakness of the low-interest-rate currencies.
So products were developed that allowed investors to borrow easily in several currencies at once and invest in a portfolio of high-interest-rate currencies.
Some alleged that these unconventional monetary policies – and the accompanying ballooning of central banks’ balance sheets – were a form of debasement of fiat currencies.
The result, they argued, would be runaway inflation (if not hyperinflation), a sharp rise in long-term interest rates, a collapse in the value of the US dollar, a spike in the price of gold and other commodities, and the replacement of debased fiat currencies with cryptocurrencies such as bitcoin.
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