The East (China) has low interest rates and an appreciating currency, while the West, along with Europe, Japan, and South Korea, has high interest rates and a depreciating currency. It's a bizarre state of affairs. The East is aggressively appreciating its currency to destroy the foreign currency inflows from abroad to prevent industrial overcapacity. This, in turn, causes commodities to appreciate and become more expensive, requiring even stronger currency appreciation to suppress production expansion.

High-interest, depreciating debt-issuing countries, once they consider currency appreciation to curb inflation, face monetary tightening which triggers commodity price increases, re-inflation, and a technical economic recession due to tight liquidity.