The world breathed a collective sigh of relieve when finance ministers of the leading economies declared earlier this month in Moscow that they would refrain from waging a currency war.

In a communiqu, they said: "We will refrain from competitive devaluation. We will not target our exchange rates for competitive purposes."

They also refrained from naming Japan as the culprit for instigating the latest threat of global economic warfare. It has adopted aggressive monetary and fiscal policies that have driven down the value of the yen by 20 percent against the US dollar in the past couple of months. Instead, the communiqu sought to reaffirm the G20's commitment to move "more rapidly toward more market-determined exchange rate systems and exchange rate flexibility to reflect underlying fundamentals".