But while there are certainly some central banks that have actively moved to manage exchange rates to manage risks to growth, there isn't a whole lot of evidence that central bank intervention in FX markets is particularly large on a global scale. If anything, the level of intervention has actually dropped dramatically.
The chart on the left shows the growth rates in global foreign exchange reserves (in US$ terms), which is the total amount of foreign currency held by central banks around the globe. If there were a direct effort to devalue currency, the most direct way would be to sell your own nations currency, leading to a rise if forex reserves.
So what exactly is going on? The super strong growth pre-2008 was partly thanks to commodity producing currencies seeing large inflows, but primarily due to China trying to manage the appreciation of the RMB. While the RMB did rise, China had to furiously buy foreign exchange to ensure it didn't rise faster.
But that battle seems to have ended for now, with foreign inflows into China much less aggressive. In some ways, this is reflective of global liquidity conditions, which are nowhere near as easy as often proported. If anything, this suggests global liquidity has dropped dramatically, with central bank balance sheet expansion not enough to replace the enthusiasm and leverage seen prior to the financial crisis.
It could be argued that "currency wars" are more surreptitious, with central bank money creation aimed at weakening currencies rather than the direct route of straight out purchases of forex. This may be a positive side-effect for central banks, but I dont think its directly part of what they are trying to achieve. Japan maybe exception, but you can very easily also justify Yen weakness based on economic prospects.
