Following several weeks of back and forth monetary easing and tinkering that has seemingly roiled currency markets, the G7 recently issued a statement regarding the bourgeoning currency weakness, known colloquially as the "currency war."

"We, the G7 Ministers and Governors, reaffirm our longstanding commitment to market determined exchange rates and to consult closely in regard to actions in foreign exchange markets. We reaffirm that our fiscal and monetary policies have been and will remain oriented towards meeting our respective domestic objectives using domestic instruments, and that we will not target exchange rates. We are agreed that excessive volatility and disorderly movements in exchange rates can have adverse implications for economic and financial stability. We will continue to consult closely on exchange markets and cooperate as appropriate."

If anything, the weakness of the language is seen as a sign that Japan isn't being condemned for its policy that has weakened the yen. Green light. Yen down a little bit post statement.

Shortly after, Bank of England officials were pointedly blunt in their analysis suggesting the acute weakness of the statement, portending a mitigated effect and likely to cause no big implications at all. There was however, a consensus agreement against outward currency manipulation and in favor of market-set exchange rates.

Over the past few months even, there has been a growing concern about the potential for currency wars unfolding in the present and into the near future as countries battle to remain competitiveness in the global market via low export prices and goods. Ultimately, this problem arises when individual countries embark on domestic paths to artificially stimulate their respective economies, in essence instigating a global web of quantitative easing strategies as seen in the United States, i.e. the devaluation of a currency in the hopes of fostering the competiveness of domestic exports on the international state – ironically an issue most have taken up with China in recent years.

However, while the US Federal Reserve and the Bank of Japan are rapidly minting more cash, the ECB is taking a more cautioned approach, as banks are paying back some of the cheap money it distributed last year. Worryingly for some in the EU, this could drive the euro even higher, which is the last thing the fragile eurozone economy would need at the present.

French finance minister Pierre Moscovici yesterday warned of the effect a rising euro could have on European growth. However, German officials, who promptly said that exchange rates should not be manipulated, rebuffed him. Consequently, the incendiary rhetoric has worried many, prompting the G7 statement today.