Asia came to currency early, and it soon learnt to treat coinage as a weapon of war. Indeed, the coins minted in China during the warring states era, almost 500 years before Christ, were made in the shape of knives.

This may explain why the west tends to be terrified by Asian currency policy. China has long been branded a currency manipulator. Japan’s aggressive new attempt to stimulate its economy with monetary policy under prime minister Shinzo Abe has led other countries to complain that the yen is deliberately being devalued.

And yet Asian currency moves are deeply misunderstood. China is not winning the currency wars; it is losing them. It has steadily lost competitiveness in recent years, and the financial press now even raises the question of whether China could soon suffer a dollar shortage, a question that would elicit gasps and laughter in the west.