The country that coined the term “currency wars” has just added to its rhetorical arsenal. Brazil wants the World Trade Organisation to allow “exchange rate anti-dumping measures”, which would let Brasilia retaliate against countries that undertake competitive devaluations of their currencies via ultra- easy monetary policies. The proposal does not stand a chance. But it is a worrying sign of the kind of protectionism the world has so far avoided in four years of financial crisis and recession.

Although its currency has weakened recently, Brazil is worried that the real might shoot even higher should the US and the UK and embark on more quantitative easing. As Brasilia sees it, that would make it the innocent victim in Currency Wars Part II. Yet Brazil’s strong exchange rate remains largely its own fault.

Last year, the government spent freely before presidential elections. BNDES, a state development bank, spewed out cheap credit. When the economy overheated, the central bank was compelled to jack up interest rates higher than it would otherwise have had to. This attracted massive capital inflows – which, in turn, pushed up the real. Brazil shot itself in the foot, but blamed others for the injury.