The Mercantilist race to the bottom continues...
By JAMES HOOKWAY in Hanoi and ALEX FRANGOS in Hong Kong
Vietnam's decision to devalue its currency raises tensions across Asia as the region's export-driven economies jostle for an edge amid a slow recovery in orders from the U.S. and Europe.
Vietnam shaved 5% off the value of its currency, the dong, on Wednesday, its third devaluation since June 2008. It also increased interest rates by one percentage point, to 8%. The moves were driven primarily by domestic concerns, including a need to combat speculative pressure that has weighed on Vietnam's economy for more than a year.