Europe's currency manipulation

Warsaw

THE Transatlantic Trade and Investment Partnership (TTIP), which the European Union and the United States currently are negotiating, would, studies say, boost welfare and reduce unemployment in both economies, as well as in other countries. At the same time, the TTIP could help to restore confidence in Europe and the transatlantic community. But there is one major barrier to realising these benefits: the euro.

The problem stems from currency manipulation. Over the past three decades, the US has de facto tolerated currency manipulation by its major Asian trading partners, which built up large trade and current-account surpluses by suppressing the value of their currencies.

But the US is unlikely to accept such behaviour within free-trade zones. Indeed, a bipartisan majority in the US Congress is already demanding that the Trans-Pacific Partnership (TPP) - a mega-regional free-trade deal involving 12 Pacific Rim countries - should include provisions barring currenc…