The global "currency war" could get even worse if Europe joins the fray, says the man widely credited with coining the term.
The Brazilian finance minister, Guido Mantega, says European countries should focus on reviving their economies with more investments, rather than trying to weaken the euro to protects jobs as France has suggested ahead of this week's meeting of Group of 20 (G20) leading and emerging economic powers.
"We will continue to have this currency problem unless the global economy takes off," said Mr Mantega. "The solution here is to make their economies more dynamic and jolt them out of stagnation."
More than two years ago, Mr Mantega used the term "currency wars" to describe the series of competitive devaluations adopted by rich nations to bolster their exports amid the global slowdown to the detriment of emerging nations.
Since then Brazil has actively sought to depreciate its currency, the real, to protect local manufacturers of goods ranging from shoes to suits and make its exports more competitive. It has taken bold action to curb speculative capital inflows with higher taxes.
Mr Mantega said that approach was not right for everyone - especially for heavily industrialised nations. "It is useless for the European Union to try to get out of the crisis by exporting more to the United States, Asia or even Brazil," he said.
"We are battling over the scraps. We are elbowing each other to compete in a very restrictive market."
He believes the most important discussion at the G20 meeting in Moscow will be "the return of stimulus policies".
France plans to take its concerns over the euro to the meeting, warning that a stronger euro might hinder Europe's painfully slow recovery.
The French president François Hollande added to fears of a renewed global currency war on Tuesday when he called for a weaker euro and urged the euro zone to set a mid-term target for its exchange rate.
The euro has strengthened more than 8 per cent against the US dollar in the past six months. It is trading close to its strongest level in 15 months against the dollar because of improved sentiment about the euro-zone bloc that has led investors to flood back in.
The Italian-born Mr Mantega said European nations should take a cue from Brazil to bolster investment by launching their own infrastructure investment programmes.
Despite government efforts to lure investment, the once-booming Brazilian economy continues to crawl at a slower pace than some European countries, growing about 1 per cent last year.
But Mr Mantega says an improving global economy should help Brazil to regain the impressive growth rates that made it a star among emerging market nations over the past decade.
He said G20 nations agreed that risks to the global economy had reduced substantially after a break-up of the euro zone was averted and the United States avoided running off a "fiscal cliff" that would have slammed its economy with US$600 billion (Dh2.2 trillion) in automatic tax increases and spending cuts.
"The fact is that risks have diminished greatly and that is very positive because it encourages investment," Mr Mantega said. "The global outlook has improved."
He warned that the US still had to resolve political wrangling over its debt to secure faster growth in the world's largest economy.