Asian foreign exchange markets are under pressure. Since 2007, good macroeconomic fundamentals, favourable growth prospects and high interest rates have made the emerging countries a favourite destination for capital. Though the crisis interrupted these flows at the end of 2008, the American...

The current crisis revealed the threat posed by current account imbalances on the very existence of the euro area. In the absence of a federal response, national rebalancing efforts will be needed. Two adjustment strategies seem at hand: external or internal devaluation. The Latvian and Irish...