Global exchange rate figures are unbelievable: the Canadian dollar is at its strongest value against the U.S. dollar in 48 years. Since May 2003, the most recent rate peak, the U.S. dollar has lost 33% of its value against an average of a basket of the world’s currencies.

In Brazil, the dollar’s fall has had many consequences, some of which are good. It has helped Brazil to maintain very low inflation in recent years, increasing the purchasing power of all Brazilians. We have, for instance, a boom in sales of American notebook and desktop computers, because the falling dollar has brought down their prices. That has made computers more affordable for working class Brazilians. In three years, personal computer sales have increased 300%.

Some of those consequences have been negative. As expected, exporters are losing money and protesting an “invasion” of foreign goods. U.S.-funded NGOs’ financial stability is rapidly deteriorating, to the detriment of their work here.

But the real problem is not the U.S. China’s artificial currency controls still more or less peg the renminbi to the dollar. That creates a major distortion on international trade. The U.S. currency is falling due to the country’s abysmal external deficit. Any economics textbook teaches that a country with this level of disequilibrium in its balance of trade will see its currency fall. However, China has the largest trade surplus on Earth (US$ 244 billion). How does it explain its undervalued currency? If we look closely, the Chinese exchange rate policy has created more problems around the world than the weak dollar.