SocGen's Edwards: Latest yen weakness will prompt 'tidal wave of deflation'

Renewed yen weakness could bring about a fresh global currency war resulting in a 'tidal wave of deflation' in China and the West, Société Générale's Albert Edwards has warned.

The analyst said the yen has broken its 30-year upwards trend, which will cause "big deflationary problems" for China - which he said is already in outright deflation and cannot tolerate any further rises in its currency, the renminbi. After holding up well at the start of 2015 despite the rally in the US dollar, the yen has resumed its downwards trend over the past week. The currency hit a renewed 12-year low of 125 against the dollar overnight. "The yen has just moved back centre stage, " Edwards said in his weekly global strategy review. "Back in September last year, when the ye...