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Coordination failure

Emerging market currency rescue is a pipe dream

Andy Mukherjee 

Andy Mukherjee Can emerging markets fight back against currency speculators? An idea floated by India to mount a joint defence has a certain charm. After a rout in the rupee the past three months, New Delhi wants other developing countries to help in a coordinated intervention in offshore foreign exchange markets, Reuters reported on Aug. 31. In reality, it sounds unworkable. The premise is simple enough: central banks in developing Asian countries have $4.3 trillion in reserves. Add to that the $500 billion foreign-currency kitties of Brazil, South Africa and Turkey. If the holders teamed up to sell ...

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First Published: Mon, September 02 2013. 21:31 IST