"Correcting the exchange rate with China is the perfect way to stem some loss of jobs without violating international trade rules".
As a result, during the years of big capital flows to the European periphery, Poland saw a currency appreciation rather than differential inflation, and it was able to correct that real exchange rate quickly when crisis struck: So what does Poland's leadership want to do?
Correcting overvalued exchange rates, which increases the domestic price of tradable food items, and controlling inflation, which slows down the rate of increase in domestic food prices and reduces the cost of stabilization measures, should therefore be put high on the policy reform agenda, and kept there.
His argument is that current account imbalances cannot be corrected without an exchange rate change.
As a result, even were they to succeed in substantially writing down their debts, these countries would still be left with very sizeable budget deficits that would be extraordinarily difficult to correct in a fixed exchange rate arrangement.
Zhou Xiaochuan, the governor of the Chinese central bank, said the market had "its own power to correct" any imbalances in the exchange rate.
Using the same exchange rate US$1=GBP0.677173 (correct as of April 2015), the values in UK 2014 prices were £103.42 and £41.37, respectively.
"The process of correcting the misalignment of the exchange rate remains incomplete," Mr. Geithner said in a speech in April.
UK costs were inflated using the Hospital & Community Health Services Pay and Prices Index, 57 while US costs were inflated to 2014 prices using the Department of Labor's Consumer Price Index Calculator, 58 and converted to UK pound sterling using the exchange rate of US$1=GBP0.677173 (correct as of April 2015).
