A sole cheater can win a card game, but there will be a big brawl if everyone tries to follow his example. It is the same with currencies. The list of enthusiastic devaluers is long enough to stir up a global fight: Japan, China, the US, the UK and Korea. Brazil and others might join in, to avoid the costs of a rising currency. No wonder the Brazilian finance minister is talking about a “currency war”.
It is hard to say which countries really belong on the currency blacklist, because there is no clear definition of cheating. Intervention may be permissible to stabilise the currency. Domestic necessity might justify low policy interest rates and quantitative easing, which both tend to depress currencies. And countries can simply decide capital controls are now OK in their rule-book.
Whatever the definition of foul play in the foreign exchange market, it is spreading. Why now? Frustrated governments hope a cheaper currency will speed up economic growth. The deeper issue, though, is financial and political imbalances. Rich countries crave a lower currency because higher exports can make excessive debts less onerous. Conversely, developing nations want to sustain their own exports; and see rich countries unfairly using currencies to slow down their relative geopolitical decline.