Volkmar Baur at Commerzbank flags surging trade and current account surpluses in China, Taiwan and South Korea alongside weak currencies versus Euro (EUR) and, for the Won (KRW), even versus US Dollar (USD). He links this to systematic FX intervention that keeps real exchange rates low, warning that such surplus‑driven weakness shifts deficits onto other economies and dampens overall global growth.

Export surpluses and suspected intervention

"High growth rates and strong export performance should be pointing quite clearly toward currency appreciation."

"The most surprising aspect of the whole situation, however, is that this development has taken place in recent months without the currencies of these countries appreciating."

"Since the beginning of last year, the CNY has lost 5.5% against the euro, the Taiwanese dollar has lost nearly 9%, and the South Korean won has depreciated by 12.6% against the euro over roughly the past 15 months."

"The fact that this is not happening suggests that these countries are systematically intervening in their currency developments."

"According to the IMF, high surpluses driven by a weak currency therefore not only burden other economies, but also lead to lower global growth overall."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)