The threat of a currency war is more serious than many realise, and central banks should go to greater lengths to avoid one, Benoît Cœuré, a member of the executive board of the European Central Bank (ECB), said yesterday.

Cœuré warned that a ‘Panglossian' view was emerging, which suggested a currency war could be a good way to achieve widespread monetary easing, through external rather than internal channels. Cœuré argued this would be damaging, and could result in a "global inflationary bias"