the commodities collapse, Mexico had warned China of triggering currency wars. They are also called foreign currency reserves or foreign reserves. 2, however, the term in popular usage also adds gold reserves, special drawing rights (SDRs and, international Monetary Fund (IMF) reserve positions. As a consequence, even those central banks that strictly limit foreign exchange interventions often recognize that currency markets can be volatile and may intervene to counter disruptive short-term movements (that may include speculative attacks ).
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"Undervaluation through foreign reserve accumulation: static losses, dynamic gains." World Bank Policy Research Working Paper Series, Vol (2010). In that way, a strong position in foreign currency reserves can prevent economic crises caused when an event triggers a flight to safety. Israel 133.0 Aviation, high tech. 15 16 Official international reserves, the means of official international payments, formerly consisted only of gold, and occasionally silver. In this context, foreigners have the role to choose only the useful tradable goods sectors. That prevents food shortages, for example.
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