{"id":14937,"date":"2021-10-12T21:13:07","date_gmt":"2021-10-12T21:13:07","guid":{"rendered":"https:\/\/www.pantheregroup.com\/2021\/10\/12\/macklem-aims-to-take-bigger-role-on-world-stage-after-year-of-putting-out-fires-at-home\/"},"modified":"2021-10-12T21:13:07","modified_gmt":"2021-10-12T21:13:07","slug":"macklem-aims-to-take-bigger-role-on-world-stage-after-year-of-putting-out-fires-at-home","status":"publish","type":"post","link":"https:\/\/www.pantheregroup.com\/2021\/10\/12\/macklem-aims-to-take-bigger-role-on-world-stage-after-year-of-putting-out-fires-at-home\/","title":{"rendered":"Macklem aims to take bigger role on world stage after year of putting out fires at home"},"content":{"rendered":"<div style=\"text-align:center\"><\/div><p> \n<\/p>\n<div id=\"\">\n<header aria-label=\"Beginning of Article\" class=\"article-header\">\n<nav aria-label=\"Breadcrumb\" class=\"breadcrumbs\">\n<h2 class=\"visually-hidden\">Breadcrumb Trail Links<\/h2>\n<ol class=\"breadcrumbs__items list-unstyled\">\n<li class=\"breadcrumbs__item\"> News <\/li>\n<li class=\"breadcrumbs__item\"> FP Economy <\/li>\n<\/ol>\n<\/nav>\n<p class=\"article-subtitle\"> The rules of global finance are being rewritten and Tiff Macklem intends to be a part of it <\/p>\n<div class=\"article-meta\">\n<div class=\"published-by\">\n<p>Author of the article:<\/p>\n<p> <span class=\"published-by__author\">Kevin Carmichael<\/span> <\/div>\n<div class=\"published-date\">\n<p>Publishing date:<\/p>\n<p> <span class=\"published-date__since\">Oct 12, 2021<\/span> \u00a0\u2022\u00a0 <span class=\"updated-date__since\">37\u00a0minutes ago<\/span> \u00a0\u2022\u00a0 <span class=\"published-date__word-count\">4 minute read<\/span> \u00a0\u2022\u00a0 <span>  <span class=\"comment-bubble\"> <svg xmlns=\"http:\/\/www.w3.org\/2000\/svg\" height=\"16\" viewbox=\"0 0 24 24\" width=\"16\"><path d=\"M4,0 C2.93914,0 1.921718,0.421428 1.171572,1.171572 C0.421428,1.921718 0,2.93914 0,4 L0,24 L3.846,20.158 L4,20.16 L20,20.16 C21.0608,20.16 22.0782,19.73858 22.8284,18.98842 C23.5786,18.23828 24,17.22086 24,16.16 L24,4 C24,2.93914 23.5786,1.921718 22.8284,1.171572 C22.0782,0.421428 21.0608,0 20,0 L4,0 Z M2,4 C2,3.46956 2.21072,2.96086 2.58578,2.58578 C2.96086,2.21072 3.46956,2 4,2 L20,2 C20.5304,2 21.0392,2.21072 21.4142,2.58578 C21.7892,2.96086 22,3.46956 22,4 L22,16.16 C22,16.69044 21.7892,17.19914 21.4142,17.57422 C21.0392,17.94928 20.5304,18.16 20,18.16 L4,18.16 L3.048,18.126 L2,19.174 L2,4 Z\"\/><\/svg><\/span> Join the conversation  <\/span> <\/div><\/div>\n<figure class=\"featured-image\"><picture class=\"featured-image__ratio featured-image-category__economy\"><\/picture><figcaption class=\"featured-image__caption image-caption\"><span class=\"caption\">Bank of Canada Governor Tiff Macklem arrives at an event at the Bank of Canada in Ottawa on Oct. 7, 2021. <\/span> <span class=\"credit\">Photo by Blair Gable\/Reuters files<\/span> <\/figcaption><\/figure>\n<\/header>\n<section class=\"article-content__content-group\">\n<h2 class=\"visually-hidden\">Article content<\/h2>\n<p>The Great Recession inspired so much fear that the world\u2019s economic powers came together under the banner of the Group of 20 to confront it. By contrast, COVID-19 caused those same countries to turn inward. The pandemic was global, but the responses have been local.<\/p>\n<\/section>\n<div class=\"ad__section-border article-content__ad-group\">\n<section class=\"ad\">\n<h2 class=\"visually-hidden\">Advertisement<\/h2>\n<div class=\"ad__container\">\n<div class=\"ad__inner\" id=\"ad__inner-2\">\n<div class=\"ad__inner__container\" data-ad=\"[[6,6],[1200,250],[1200,90],[970,90],[970,250],[728,90],[300,250]]\" data-ad-interscroller=\"6x6\" data-ad-loc=\"2\" data-ad-mobile=\"[[6,6],[320,50],[300,50],[300,250],[300,600]]\" id=\"ad-2\" style=\"--desktopHeight:250px;--mobileHeight:600px\">\n<div class=\"ad__placeholder\">\n<p> This advertisement has not loaded yet, but your article continues below. <\/p>\n<\/p><\/div><\/div><\/div><\/div>\n<\/section>\n<\/div>\n<section class=\"article-content__content-group\">\n<h2 class=\"visually-hidden\">Article content<\/h2>\n<p>Does the G20 even still meet? Maybe no one cares, but we probably should. Canada does better when the world\u2019s bullies agree to down swords and respect a common set of rules and norms. Think back to 2008 and 2009. A smallish country\u2019s banking system, apparently the soundest in the world, was still at the mercy of whatever shenanigans they were getting up to in the world\u2019s major financial centres.<\/p>\n<p>Canada has never really had the economic clout necessary to make people take notice, and it\u2019s been a long time since we spent enough on the military to be of much help on security matters. But Ottawa has a tradition of sending technocrats out into the world to help keep the international conversation going, contributing ideas and\/or time to efforts that have little direct connection to their day jobs.<\/p>\n<\/section>\n<div class=\"ad__section-border article-content__ad-group\">\n<section class=\"ad\">\n<h2 class=\"visually-hidden\">Advertisement<\/h2>\n<div class=\"ad__container\">\n<div class=\"ad__inner\" id=\"ad__inner-3\">\n<div class=\"ad__inner__container\" data-ad=\"[[7,7],[1200,250],[1200,90],[970,90],[970,250],[728,90],[300,250]]\" data-ad-interscroller=\"7x7\" data-ad-loc=\"3\" data-ad-mobile=\"[[7,7],[300,250],[320,50],[300,50]]\" id=\"ad-3\" style=\"--desktopHeight:250px;--mobileHeight:250px\">\n<div class=\"ad__placeholder\">\n<p> This advertisement has not loaded yet, but your article continues below. <\/p>\n<\/p><\/div><\/div><\/div><\/div>\n<\/section>\n<\/div>\n<section class=\"article-content__content-group\">\n<h2 class=\"visually-hidden\">Article content<\/h2>\n<p>This is especially true of central bankers. David Dodge, who led the Bank of Canada from 2001 to 2008, tried to focus global policy-makers on the massive current-account deficit in the United States, and its equally destabilizing flip side, the massive surpluses in Asia. (If only they had listened.)<\/p>\n<p>More recently, Mark Carney, another former governor, led the Financial Stability Board as it rewrote global banking rules after the Great Recession. Carolyn Rogers, the Bank of Canada\u2019s incoming senior deputy governor, is finishing a stint as secretary general of the Basel Committee on Banking Supervision before officially starting her new job in December.<\/p>\n<p data-async=\"\">Tiff Macklem, the current governor, last week signalled his intention to keep up the tradition. His comments on growth and inflation received all the attention, but those remarks came after he delivered a\u00a0 speech that had nothing to do with the unemployment rate or supply-chain bottlenecks. The parochialism and short-term orientation of the financial press was on full display, as every question, including mine, was related to Canada\u2019s immediate economic concerns. The conversation that Macklem wanted to have was bigger.<\/p>\n<\/section>\n<div class=\"ad__section-border article-content__ad-group\">\n<section class=\"ad\">\n<h2 class=\"visually-hidden\">Advertisement<\/h2>\n<div class=\"ad__container\">\n<div class=\"ad__inner\" id=\"ad__inner-4\">\n<div class=\"ad__inner__container\" data-ad=\"[[1200,250],[1200,90],[970,90],[970,250],[728,90],[300,250]]\" data-ad-loc=\"4\" data-ad-mobile=\"[[320,50],[300,50],[300,250]]\" id=\"ad-4\" style=\"--desktopHeight:250px;--mobileHeight:250px\">\n<div class=\"ad__placeholder\">\n<p> This advertisement has not loaded yet, but your article continues below. <\/p>\n<\/p><\/div><\/div><\/div><\/div>\n<\/section>\n<\/div>\n<section class=\"article-content__content-group\">\n<h2 class=\"visually-hidden\">Article content<\/h2>\n<div class=\"js-fill-card-detail-desc\">\n<div class=\"window-module\">\n<div class=\"u-gutter\">\n<div class=\"editable\">\n<div class=\"description-content js-desc-content\">\n<div class=\"current markeddown hide-on-edit js-desc js-show-with-desc\" dir=\"auto\">\n<p>\u201cAs the recovery from the pandemic progresses, and major economies begin to remove exceptional monetary stimulus, the (global financial) system will likely come under more pressure,\u201d he said.<\/p>\n<p>Interest rates in the U.S. have been at zero for so long that bond buyers have been forced farther afield to find decent returns. Emerging-market debt has become a favourite. Those flows can be destabilizing if asset prices move too quickly in one direction or another. Like Dodge in the years before the 2008-09 financial crisis, Macklem has decided to use his position to bring attention to a global financial system that looks dangerously unbalanced. As soon as interest rates begin to rise in rich countries, the hedge funds and other investors that chased yield in emerging markets will likely rush back to the safety of U.S. and European debt. It could get messy.<\/p>\n<p>\u201cThe fallout from the pandemic and the inevitable adjustments ahead as major regions recover at different speeds make dealing with these issues more urgent,\u201d said Macklem, who served as the Finance Department\u2019s top diplomat during the Great Recession.<\/p>\n<p>Macklem suggested exchange rates were the place to get started on fixing things. He called on the International Monetary Fund to create a \u201cframework\u201d for currency policy that recognizes that the commitment to floating exchange rates \u2014 a core tenet of the global economy since the 1970s \u2014 is wavering in many emerging markets.<\/p>\n<\/p><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<section aria-labelledby=\"moreTopicLabel6748673494313311753055329847175990\" class=\"more-topic\" data-carousel-component=\"\" data-carousel-icon-button=\"\" data-carousel-type=\"list\"> <button aria-hidden=\"true\" class=\"more-topic__button-prev\" data-carousel-prev=\"\" tabindex=\"-1\" title=\"previous\" type=\"button\"\/> <\/p>\n<ol class=\"more-topic__items list-unstyled\" data-carousel-slide-list=\"\" tabindex=\"0\">\n<li class=\"more-topic__item\" data-carousel-item=\"\">  <picture class=\"more-topic__item-image\"><img decoding=\"async\" src=\"data:image\/gif;base64,R0lGODlhAQABAIAAAAAAAP\/\/\/ywAAAAAAQABAAACAUwAOw==\" fifu-lazy=\"1\" fifu-data-sizes=\"auto\" fifu-data-srcset=\"https:\/\/i2.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012imf.jpg?h=96&strip=all&quality=80&ssl=1&w=75&resize=75&ssl=1 75w, https:\/\/i2.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012imf.jpg?h=96&strip=all&quality=80&ssl=1&w=100&resize=100&ssl=1 100w, https:\/\/i2.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012imf.jpg?h=96&strip=all&quality=80&ssl=1&w=150&resize=150&ssl=1 150w, https:\/\/i2.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012imf.jpg?h=96&strip=all&quality=80&ssl=1&w=240&resize=240&ssl=1 240w, https:\/\/i2.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012imf.jpg?h=96&strip=all&quality=80&ssl=1&w=320&resize=320&ssl=1 320w, https:\/\/i2.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012imf.jpg?h=96&strip=all&quality=80&ssl=1&w=500&resize=500&ssl=1 500w, https:\/\/i2.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012imf.jpg?h=96&strip=all&quality=80&ssl=1&w=640&resize=640&ssl=1 640w, https:\/\/i2.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012imf.jpg?h=96&strip=all&quality=80&ssl=1&w=800&resize=800&ssl=1 800w, https:\/\/i2.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012imf.jpg?h=96&strip=all&quality=80&ssl=1&w=1024&resize=1024&ssl=1 1024w, https:\/\/i2.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012imf.jpg?h=96&strip=all&quality=80&ssl=1&w=1280&resize=1280&ssl=1 1280w, https:\/\/i2.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012imf.jpg?h=96&strip=all&quality=80&ssl=1&w=1600&resize=1600&ssl=1 1600w\" alt=\"The International Monetary Fund warns threats to growth have increased, pointing to the Delta variant, strained supply chains, accelerating inflation and rising costs for food and fuel.\" class=\"lazyload\" fifu-data-src=\"https:\/\/i2.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012imf.jpg?h=96&strip=all&quality=80&ssl=1\" height=\"96\" loading=\"lazy\" srcset=\"https:\/\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012imf.jpg?h=96&strip=all&quality=80,\n                                    https:\/\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012imf.jpg?h=192&strip=all&quality=80 2x,\n                                    https:\/\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012imf.jpg?h=288&strip=all&quality=80 3x\" width=\"96\"\/><\/picture>\n<h3 class=\"more-topic__item-text\"> <span class=\"more-topic__item-text-clamp\"> IMF cuts Canada&#8217;s growth forecast for this year, trims view on global rebound amid &#8216;dangerous divergence&#8217; <\/span> <\/h3>\n<\/li>\n<li class=\"more-topic__item\" data-carousel-item=\"\">  <picture class=\"more-topic__item-image\"><img decoding=\"async\" src=\"data:image\/gif;base64,R0lGODlhAQABAIAAAAAAAP\/\/\/ywAAAAAAQABAAACAUwAOw==\" fifu-lazy=\"1\" fifu-data-sizes=\"auto\" fifu-data-srcset=\"https:\/\/i2.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012boc.jpg?h=96&strip=all&quality=80&ssl=1&w=75&resize=75&ssl=1 75w, https:\/\/i2.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012boc.jpg?h=96&strip=all&quality=80&ssl=1&w=100&resize=100&ssl=1 100w, https:\/\/i2.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012boc.jpg?h=96&strip=all&quality=80&ssl=1&w=150&resize=150&ssl=1 150w, https:\/\/i2.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012boc.jpg?h=96&strip=all&quality=80&ssl=1&w=240&resize=240&ssl=1 240w, https:\/\/i2.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012boc.jpg?h=96&strip=all&quality=80&ssl=1&w=320&resize=320&ssl=1 320w, https:\/\/i2.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012boc.jpg?h=96&strip=all&quality=80&ssl=1&w=500&resize=500&ssl=1 500w, https:\/\/i2.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012boc.jpg?h=96&strip=all&quality=80&ssl=1&w=640&resize=640&ssl=1 640w, https:\/\/i2.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012boc.jpg?h=96&strip=all&quality=80&ssl=1&w=800&resize=800&ssl=1 800w, https:\/\/i2.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012boc.jpg?h=96&strip=all&quality=80&ssl=1&w=1024&resize=1024&ssl=1 1024w, https:\/\/i2.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012boc.jpg?h=96&strip=all&quality=80&ssl=1&w=1280&resize=1280&ssl=1 1280w, https:\/\/i2.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012boc.jpg?h=96&strip=all&quality=80&ssl=1&w=1600&resize=1600&ssl=1 1600w\" alt=\"Bank of Canada governor Tiff Macklem.\" class=\"lazyload\" fifu-data-src=\"https:\/\/i2.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012boc.jpg?h=96&strip=all&quality=80&ssl=1\" height=\"96\" loading=\"lazy\" srcset=\"https:\/\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012boc.jpg?h=96&strip=all&quality=80,\n                                    https:\/\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012boc.jpg?h=192&strip=all&quality=80 2x,\n                                    https:\/\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012boc.jpg?h=288&strip=all&quality=80 3x\" width=\"96\"\/><\/picture>\n<h3 class=\"more-topic__item-text\"> <span class=\"more-topic__item-text-clamp\"> Bank of Canada&#8217;s 2% inflation target should stay as is, Canadians tell Trudeau <\/span> <\/h3>\n<\/li>\n<li class=\"more-topic__item\" data-carousel-item=\"\">  <picture class=\"more-topic__item-image\"><img decoding=\"async\" src=\"data:image\/gif;base64,R0lGODlhAQABAIAAAAAAAP\/\/\/ywAAAAAAQABAAACAUwAOw==\" fifu-lazy=\"1\" fifu-data-sizes=\"auto\" fifu-data-srcset=\"https:\/\/i1.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012inflation.jpg?h=96&strip=all&quality=80&ssl=1&w=75&resize=75&ssl=1 75w, https:\/\/i1.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012inflation.jpg?h=96&strip=all&quality=80&ssl=1&w=100&resize=100&ssl=1 100w, https:\/\/i1.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012inflation.jpg?h=96&strip=all&quality=80&ssl=1&w=150&resize=150&ssl=1 150w, https:\/\/i1.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012inflation.jpg?h=96&strip=all&quality=80&ssl=1&w=240&resize=240&ssl=1 240w, https:\/\/i1.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012inflation.jpg?h=96&strip=all&quality=80&ssl=1&w=320&resize=320&ssl=1 320w, https:\/\/i1.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012inflation.jpg?h=96&strip=all&quality=80&ssl=1&w=500&resize=500&ssl=1 500w, https:\/\/i1.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012inflation.jpg?h=96&strip=all&quality=80&ssl=1&w=640&resize=640&ssl=1 640w, https:\/\/i1.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012inflation.jpg?h=96&strip=all&quality=80&ssl=1&w=800&resize=800&ssl=1 800w, https:\/\/i1.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012inflation.jpg?h=96&strip=all&quality=80&ssl=1&w=1024&resize=1024&ssl=1 1024w, https:\/\/i1.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012inflation.jpg?h=96&strip=all&quality=80&ssl=1&w=1280&resize=1280&ssl=1 1280w, https:\/\/i1.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012inflation.jpg?h=96&strip=all&quality=80&ssl=1&w=1600&resize=1600&ssl=1 1600w\" alt=\"Rising prices are eroding consumer confidence, RBC Capital Markets\u2019 U.S. chief economist says.\" class=\"lazyload\" fifu-data-src=\"https:\/\/i1.wp.com\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012inflation.jpg?h=96&strip=all&quality=80&ssl=1\" height=\"96\" loading=\"lazy\" srcset=\"https:\/\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012inflation.jpg?h=96&strip=all&quality=80,\n                                    https:\/\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012inflation.jpg?h=192&strip=all&quality=80 2x,\n                                    https:\/\/smartcdn.prod.postmedia.digital\/financialpost\/wp-content\/uploads\/2021\/10\/vw1012inflation.jpg?h=288&strip=all&quality=80 3x\" width=\"96\"\/><\/picture>\n<h3 class=\"more-topic__item-text\"> <span class=\"more-topic__item-text-clamp\"> Stagflation debate is just a &#8216;massive distraction,&#8217; RBC&#8217;s Porcelli says <\/span> <\/h3>\n<\/li>\n<\/ol>\n<p><button aria-hidden=\"true\" class=\"more-topic__button-next\" data-carousel-next=\"\" tabindex=\"-1\" title=\"next\" type=\"button\"\/> <\/section>\n<\/section>\n<div class=\"ad__section-border article-content__ad-group\">\n<section class=\"ad\">\n<h2 class=\"visually-hidden\">Advertisement<\/h2>\n<div class=\"ad__container\">\n<div class=\"ad__inner\" id=\"ad__inner-5\">\n<div class=\"ad__inner__container\" data-ad=\"[[1200,250],[1200,90],[970,90],[970,250],[728,90],[300,250]]\" data-ad-loc=\"5\" data-ad-mobile=\"[[320,50],[300,50],[300,250]]\" id=\"ad-5\" style=\"--desktopHeight:250px;--mobileHeight:250px\">\n<div class=\"ad__placeholder\">\n<p> This advertisement has not loaded yet, but your article continues below. <\/p>\n<\/p><\/div><\/div><\/div><\/div>\n<\/section>\n<\/div>\n<section class=\"article-content__content-group\">\n<h2 class=\"visually-hidden\">Article content<\/h2>\n<p>There are reasons such countries are losing faith. So many goods and services are priced in U.S. dollars that a weaker currency won\u2019t necessarily make a county\u2019s exports more competitive, at least right away. But imports would become more expensive, putting upward pressure on inflation, and weakening the ability of a floating exchange rate to help a country absorb a downturn. A series of crises since the 1990s has also demonstrated the value of having a treasury stuffed with foreign-exchange reserves.<\/p>\n<p>Still, market-based exchange rates can help policy-makers get things right over the longer term because they send important price signals. Macklem wants the IMF to update its thinking about currencies to keep developing economies from abandoning all commitment to a free-market approach. That means making room for \u201cmanaged floating exchange rates,\u201d but offering advice on how that can be done without causing strain on a global system based on traders, not technocrats, setting exchange rates.<\/p>\n<p>\u201cThe system needs guardrails to make sure currency intervention does not get in the way of needed relative price adjustments,\u201d Macklem said. \u201cSuch an agreed-upon framework could guide managed floating exchange rate regimes to make sure they do not stall adjustment in the medium to long run.\u201d<\/p>\n<p>It\u2019s not the kind of initiative that makes for a good headline, which is why the press went for inflation last week. But it deserves attention all the same. 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