Everyone has been thinking it, but Guido Mantega, the Brazilian finance minister, has been one of the few policy-makers publicly to admit it. His assertion that there is a currency war going on follows a recent escalation of competitive intervention in the foreign exchange markets, with heavyweight powers armed with serious weaponry getting involved.

Although some argue that a generalised burst of foreign exchange intervention could act as a global monetary easing, a more widespread view is that such a round of competitive devaluation is more likely to inflame international -tensions.

It was a symbolic moment when Japan this month ended its six-year abstinence from intervening in the foreign exchange markets and sold an estimated $20bn of yen. Japan is the only one of the large industrialised Group of seven economies regularly to have used currency intervention over the past 20 years. But its traditional rationale – that interest rates were so close to zero that conventional monetary policy was losing its strength – now applies to many more -countries.