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ECB's Coene says no currency war yet

Belgium's Central Bank Governor Luc Coene arrives for a news conference on the 2013 economic forecast, in Brussels December 10, 2012. REUTER
Belgium's Central Bank Governor Luc Coene arrives for a news conference on the 2013 economic forecast, in Brussels December 10, 2012. REUTER

FRANKFURT (Reuters) - European Central Bank policymaker Luc Coene played down the recent debate about competitive currency devaluation and said there was no currency war yet.

Policymakers in advanced countries, particularly Japan and the United States, have been acting aggressively to reflate their economies, which has the effect of weakening their currencies.

"Of course you cannot ignore the consequence that the exchange rate will go down, but we are not yet there," Coene told Bloomberg in an interview.

"There is no currency war yet. A ghost has been evoked here, but too early. When monetary policy is made even more accommodating in an aggressive way, that could end up in a currency war. But we are far from that," he added.

He also said the ideal situation would be for the ECB new government bond purchase program "never to be used".

"It's like a nuclear deterrent. Whenever you use it, that will raise new questions and new issues," Coene, who is also the head of the Belgian central bank, said.

(Reporting By Eva Kuehnen)

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