LONDON The 'currency wars' long deplored by Brazilian Finance Minister Guido Mantega have involved little more than shouting matches so far, but the risk of an outbreak of outright hostilities in 2013 is growing.
Thursday's decision by the Bank of Japan to quicken the pace of money-printing for the third time in four months is merely the latest attempt by rich countries' central banks to revive growth by resorting to unconventional policies.
The concern for developing countries is that they will pay the price for this monetary activism.
As newly minted cash pours into their economies in search of higher yields, either their exchange rates will rise, making exports less competitive, or they will have to cut interest rates and/or intervene to hold down their currencies.
That could fuel credit and asset price booms that sow the seeds of inflation.
"There's some element of truth that we're now in a currency devaluation competition," said a source from a member country of the Group of Seven industrial nations.
Speaking before the BOJ's decision, the source added: "Everyone wants to export their way out of an economic slump, but if everyone tries to devalue their currencies the end result for the global economy won't be good."
The Federal Reserve, the Bank of England and the European Central Bank have all cut interest rates close to zero and flooded their banking systems with cash to try to restore confidence and encourage investors to buy riskier assets.
Chilean Finance Minister Felipe Larrain said last week's decision by the Fed to ease monetary policy even more aggressively was a source of worry for all emerging markets with healthy growth and floating exchange rates.
At a meeting last week of senior officials from the Group of 20 leading economies, currently chaired by Russia, a source with direct knowledge of the talks said there had been some slight 'finger-pointing' on the spillover of exchange rates.
Still, Russian Deputy Finance Minister Sergei Storchak said G20 ministers had not addressed competitive devaluation as such in the past two years.
"Ministers and central bankers do not believe that any of the G20 members consciously manipulate exchange rates in order to stimulate national exports," Storchak said on December 13.
Indeed, Simon Evenett, a professor of international trade and economic development at St Gallen University in Switzerland, said only five countries had devalued since November 2008 with the declared intent of improving their firms' competitiveness.
They are Vietnam, Venezuela, Ethiopia, Nigeria and Kazakhstan, said Evenett, who compiles the Global Trade Alert database of protectionist measures.
"Crisis-era competitive devaluations are undertaken by relatively small fry," he said.
Even if Japan's monetary easing weakens the yen and provokes a reaction by its neighbours and trading rivals China and South Korea, Evenett said he expected currency tensions to remain eminently manageable.
"Currency depreciation has been more a by-product of quantitative easing to prop up domestic demand rather than a conscious policy, which is why I don't buy the argument of currency wars," Evenett said.
WATCH CHINA, NOT THE FX RATE
Indeed, on the face of it, the moves in emerging market currencies this year do not seem to have been hugely disruptive.
In Asia, the Korean won and Philippine peso have risen 7 percent against the dollar so far in 2012, but the Indonesian rupiah has fallen more than 6 percent and the Indian rupee has shed more than 3 percent.
And in Latin America, the Mexican and Chilean pesos have climbed nearly 10 percent but the Brazilian real - ironically, given Mantega's bromides - has shed 10 percent.
However, if Bank of England Governor Mervyn King is right that more central banks might seek to weaken their currencies in 2013 to spur growth, Evenett said developing countries can always resort to capital controls.
"The stigma of resorting to capital controls is diminished now that the IMF has given their blessing to such measures," he said, referring to a recent International Monetary Fund paper condoning the use of controls in certain circumstances.
In any case, the example of Britain shows that a big depreciation is no guarantee of an export boom.
Sterling has fallen by about a quarter since King's BOE started to loosen policy, yet the country's goods trade deficit has widened so far this year to 8.9 billion pounds a month from 8.4 billion in 2011.
The exchange rate is just one of many factors determining a country's export competitiveness.
As members of the euro zone, Spain, Ireland and Portugal have not had the option of currency depreciation, yet all have managed to increase exports briskly by cutting costs and carving out new markets.
No market is more important than China, according to Stephen King, chief global economist at HSBC in London. His latest quarterly report contains a chart showing increasing exports to China are correlated with faster GDP growth.
Among the winners are Singapore, Malaysia, South Korea, Saudia Arabia, Chile and Australia. Among the laggards are those that have been most aggressive in loosening monetary policy -America, Britain and some big members of the euro zone.
"Relative to GDP, the United States, France, Italy and, in particular, the UK have made hardly any progress in exporting to China: indeed, the UK's China exposure looks to be not much more than a rounding error," King wrote.