Armistice in the currency war

STEPHEN GRENVILLE, former deputy governor of the Reserve Bank of Australia suggests a middle path in the ongoing currency hostilities, away from export dependence. In an economic briefing for the Australian Financial Review, "A road map for global 'currency peace'", he states that Asian countries could encourage more foreign direct investment while simultaneously discouraging short-term pro-cyclical foreign capital inflows with foreign exchange reserves used to cope with the volatility of capital flows.