Given the recent fad of currency interventions initiated by the SNB and the BoJ, the Philippine central bank, the Bangko Sentral ng Pilipinas (BSP) has threatened to join the bandwagon
From Bloomberg,
The Philippines is prepared to impose controls to cap volatility in the peso after its currency rose to a three-year high this week, central bank Governor Amando Tetangco said in an e-mail late yesterday. The bank “will not go against the fundamental currency trend but will not hesitate to use tools, including imposing prudential limits on certain transactions of banks,” he said.
Gadzooks. This guy speaks as if he has been bestowed with supernatural powers to control the marketplace, like the fabled King Canute who commanded the sea waves to halt.
The Philippines has already been engaged in subtle currency interventions, but because of the political correctness, which are meant to advance the remittance and export based interest groups, the BSP honcho has announced his willingness to do much further actions at the risks of unintended consequences
These people are hardly accountable for their actions, and would boldly take any measures at our expense.
Well, if competitive devaluation becomes widespread or the predominant measure worldwide, then expect inflation to accelerate.
Global hyperinflation could turn into a real risk.
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