As Trade Negotiations Continue, United States Declines To Name China A Currency Manipulator
In its semi-annual “Report to Congress on Macroeconomic and Foreign Exchange Policies of Major Trading Partners of the United States,” the U.S. Department of the Treasury declined to name China as a currency manipulator. Instead, citing “depreciation pressure” the yuan, the Treasury Department issued a stern warning to the Chinese government, saying it “stands out among our major trading partners in its lack of transparency around its exchange rate policies and practices.”
The report also stated, “This lack of transparency will not preclude Treasury from designating China if available evidence suggests that it is intervening through formal or informal channels to resist (yuan) appreciation in the future.”
The department did place China, along with Germany, Ireland, Japan, Singapore, South Korea, Switzerland, Taiwan, and Vietnam on its monitoring list for extra foreign exchange scrutiny. Read the full report at this link.
On the same day the report came out, President Donald Trump spoke with Chinese President Xi Jinping to address ongoing tensions and stalled trade negotiations between the two countries. President Trump offered a positive assessment of that meeting on social media. “I just concluded a very good phone call with President Xi, of China, discussing some of the intricacies of our recently made, and agreed to, trade deal,” he said. “The call lasted approximately one and a half hours, and resulted in a very positive conclusion for both countries.” President Trump also announced that Chinese and U.S. officials will meet “shortly” and that President Xi invited him and First Lady Melania Trump to visit China and that he invited President Xi to the United States.
The talks to which President Trump referred began yesterday, June 9 when representatives from the two countries, including U.S. Treasury Secretary Scott Bessent, Commerce Secretary Howard Lutnick, and U.S. Trade Representative Jamieson, met in England. As a reminder, negotiations last month in Geneva between Chinese and U.S. officials resulted in a preliminary tariff truce, but both sides already have accused the other of violating that agreement.
Stay tuned to Connecting the Dots information on these ongoing discussions.