September 24, 2022 — The dollar is sky-high. Since May 2021, it has risen 19 % against Europe’s euro, even reaching 1-to-1 parity in recent weeks. The dollar has appreciated 20 % against Britain’s pound. And it is up 28 % against Japan’s yen, provoking the Bank of Japan to sell dollars on September 22, essentially the first foreign exchange intervention by a G-7 country since 2011 and the first in the direction of supporting a currency’s value against the dollar since the euro in 2000.
May 28, 2022 — The US dollar is up 12 % against the euro over the last year. Having moved from 1.21 $/€ in May 2021 to 1.07 $/€ today, the exchange rate seems to be approaching one-to-one parity for the first time. Europeans are not happy about it. If you think that prices for oil and other commodities are high now in terms of dollars, you should see what they look like in terms of euros. Get ready for “reverse currency wars.”
The regular sort of currency wars featured countries feeling aggrieved that their trading partners were deliberately pursuing policies to weaken their own currencies. The feared motive would be gaining unfair advantage in international trade. The original phrase “currency wars” was a colorful description of what international economists had (more informatively) long called “competitive devaluations” or, when exchange rates float, “competitive depreciation.”
October 26, 2019 — This is a good time to gauge the rankings of the dollar and its rivals as major international currencies. The Bank for International Settlements came out in September with its triennial survey of turnover in the world’s foreign exchange markets. The IMF’s statistics on central bank holdings of foreign exchange reserves have gotten much more reliable lately, because China has joined in on reporting its holdings to the IMF (as Eswar Prasad explains). And SWIFT offers every month its numbers on use of major currencies in international payments.