The dance of the central banks

At Forbes, I explain how monetary policy and the control of the US dollar is actually shared between the Fed and the People's Bank of China:
There has been a sort of trade war going on between the US and China for a long time. It surfaces briefly during election campaigns – remember Mitt Romney promising to end China’s “currency manipulation”? But the rest of the time it simmers coldly under the surface.
The chief protagonists in this war are the two central banks – the Federal Reserve and the People’s Bank of China (PBOC). And the principal weapons are US dollars and US Treasuries (USTs).
Read the whole post here.


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