InvestorQ : What is a currency war and how does it impact currency values?
Riya Dwivedi made post

What is a currency war and how does it impact currency values?

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rhea Babu answered.
3 years ago
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A currency war is a mutually internecine war among nations where each nation is trying to boost its exports by weakening its currency further. Normally, currency wars are known to be harmful to all nations that participate in these wars. While India has not seen currency wars, we came close to that in September 2015 when China deliberately weakened the Yuan. This led to most EMs weakening their currencies to stay competitive in terms of exports. India also had no choice but let the INR weaken. Currency wars are not too common but that is a possibility that economists have been talking about for quite some time. The rupee value is measured in terms of the US$. Hence, it is by default exposed to external factors. Whatever impacts hard currencies like the Dollar or Yuan or Euro tends to impact the INR too!

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