In the last month alone, Australia, India, Mexico, and others have cut interest rates. China has reduced reserve requirements on banks. Denmark has taken its official deposit rate into negative territory.

Even the most stability-obsessed countries have made unexpected moves. Beyond cutting interest rates, Switzerland suddenly abandoned the policy  of partly pegging the franc’s value to that of the euro. A few days later, Singapore unexpectedly altered its exchange-rate regime, too.

More consequential, the European Central Bank has committed to a large and relatively open-ended program of large-scale asset purchases.

Even the US Federal Reserve, which is presiding over an economy that is performing far better than its developed-world counterparts,  keeps interest rates low.

This new round of central-bank activism reflects persistent concerns about economic growth. Despite a once-unthinkable amount of monetary stimulus, global output remains well below potential, with the potential itself at risk of being suppressed.

Weak demand and debt overhangs are fueling concerns about deflation in the eurozone and Japan.

If weak demand and high debt were the only factors in play, the latest round of monetary stimulus would be analytically straightforward. But they are not. Key barriers to economic growth remain largely unaddressed – and central banks cannot tackle them alone.

Central banks cannot deliver the structural components – for example, infrastructure investments, better-functioning labor markets, and pro-growth budget reforms – needed to drive robust and sustained recovery. Nor can they resolve the aggregate-demand imbalance.

IMonetary-policy instruments have become increasingly unreliable in generating economic growth, steady inflation, and financial stability.

The divegene of economic and monetary poicy among three of the world’s most systemically important economies – the eurozone, Japan, and the United States – has added another layer of confusion for the rest of the world, with particularly significant implications for small, open economies.

Of course, not all currencies can depreciate against one another at the same time.

The first condition is America’s continued willingness to tolerate a sharp appreciation of the dollar’s exchange rate. Given warnings from US companies about the impact of a stronger dollar on their earnings – not to mention signs of declining inward tourism and a deteriorating trade balance – this is not guaranteed.

Still, as long as the US maintains its pace of overall growth and job creation – a feasible outcome, given the relatively small contribution of foreign economic activity to the country’s GDP – these developments are unlikely to trigger a political response for quite a while. The second condition for broad-based currency depreciation is financial markets’ willingness to assume and maintain risk postures that are not yet validated by the economy’s fundamentals.

In any case, central banks will have to back off eventually. The question is how hard the global economy’s addiction to partial monetary-policy fixes will be to break – and whether a slide into a currency war could accelerate the timetable.