US Treasury says no major trading partner manipulates currency

WASHINGTON – The US Treasury Department said on Tuesday that no major trading partner of the United States meets the standard of currency manipulation.

In its Semi-Annual Report to Congress on International Economic and Exchange Rate Policies, the Treasury Department concluded that no major US trading partner met the criteria to be labeled as a currency manipulator during the four quarters ending December 2018.

It put China, Germany, Ireland, Italy, Japan, South Korea, Malaysia, Singapore and Vietnam on its “monitoring list,” which means their foreign exchange policies bear close monitoring.

The Treasury Department called on China to take the necessary steps to avoid “a persistently weak currency,” noting that improved economic fundamentals and structural policy settings would underpin a stronger renminbi (RMB) over time.

Liu Guoqiang, vice governor of the People’s Bank of China, said last week that China is “capable and confident” of keeping the RMB exchange rate generally stable on a reasonable and balanced level.

Adam Posen, president of Peterson Institute for International Economics, a Washington, D.C.-based think tank, said earlier on Tuesday at a press briefing that it’s “pretty close to absurd” to accuse China of currency manipulation as China basically has not manipulated the currency for the last several years.

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