Tuesday, April 20, 2010

To intervene or not to intervene


That is, the story leads with the ECB's acknowledgement that it traded 35.5 tonnes of gold for dollars in 2009 in the name of "liquidity, security, and return."

Then the story quotes the bank as having "also confirmed it had not intervened in currency markets in 2009."

But whenever a central bank exchanges gold for a currency, that is by definition a currency market intervention.

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