25 Sep 2013
60 US Senators accuse Japan of currency manipulation. US Federal Reserve continues with QE-infinity
FXstreet.com (London) - A group of 60 senators complaining about currency manipulation by Japan have written to Treasury Secretary Jack Lew and US Trade Representative Michael Froman, urging them to use the Trans-Pacific Partnership (TPP) as a vehicle for strong currency provisions.
The group is lead by Sens. Debbie Stabenow (D-Mich.) and Lindsey Graham (R-S.C.), co-chairmen of the Senate Manufacturing Caucus. The bipartisan group claims that Japanese currency manipulation “costs millions of US jobs and needs to be addressed, not only in the TPP but in all future trade agreements.”
House Ways and Means Committee ranking member Sandy Levin (D-Mich) has previously commented that: "We must continue to oppose an unfair competitive advantage from our trading partners, through legislation and trade agreements, with the ultimate goal of an enforceable global agreement on currency."
All 60 signatories of the letter are citizens of the United States. Since 2008, the US Federal Reserve has increased the M2 money stock by a third, to USD10.789 trillion. US monetary activism has driven hot money flows into emerging markets, driving inflation and reducing the competitiveness of exporters in those markets. It has aggressively pursued a policy of artificially low interest rates, purchasing assets on an unprecedented scale. The US has been joined in actively pursuing a weaker currency by other members of the November 2008 G20 emergency agreement aimed at preventing a currency war. This includes the UK, via quantitative easing, and Switzerland, who earlier this week defended its direct intervention in the forex market and its CHF1.200 floor under EUR/CHF.
The group is lead by Sens. Debbie Stabenow (D-Mich.) and Lindsey Graham (R-S.C.), co-chairmen of the Senate Manufacturing Caucus. The bipartisan group claims that Japanese currency manipulation “costs millions of US jobs and needs to be addressed, not only in the TPP but in all future trade agreements.”
House Ways and Means Committee ranking member Sandy Levin (D-Mich) has previously commented that: "We must continue to oppose an unfair competitive advantage from our trading partners, through legislation and trade agreements, with the ultimate goal of an enforceable global agreement on currency."
All 60 signatories of the letter are citizens of the United States. Since 2008, the US Federal Reserve has increased the M2 money stock by a third, to USD10.789 trillion. US monetary activism has driven hot money flows into emerging markets, driving inflation and reducing the competitiveness of exporters in those markets. It has aggressively pursued a policy of artificially low interest rates, purchasing assets on an unprecedented scale. The US has been joined in actively pursuing a weaker currency by other members of the November 2008 G20 emergency agreement aimed at preventing a currency war. This includes the UK, via quantitative easing, and Switzerland, who earlier this week defended its direct intervention in the forex market and its CHF1.200 floor under EUR/CHF.