US drops 'currency manipulator' tag from China

US drops 'currency manipulator' tag from China

Agency News

Washington, Jan 14 : The United States has decided to discontinue its designation of China as a currency manipulator, US Treasury Department said on Tuesday.

In the treasury's semi annual report on 'Macroeconomic and Foreign Exchange Policies of Major Trading Partners of the United States', Treasury Secretary Steven Mnuchin noted that China has made enforceable commitments to refrain from competitive devaluation, while promoting transparency and accountability. Despite this decision, China still remains in the ten major US trading partners that are on a "Monitory List" of countries which merit a close watch of their currency practices. Apart from China the monitory list includes Japan, Germany, Ireland, Italy, South Korea, Malaysia, Vietnam, Singapore and Switzerland, the release noted.

Mr Mnuchin said that China has made commitments in the phase one trade agreement, which will be signed on January 15, 2020 to refrain from competitive devaluation while promoting transparency and accountability. The Report concluded that while the currency practices of ten countries required close attention, no major contemporary US trading partner met the relevant 1988 or 2015 legislative criteria for currency manipulation. Welcoming the treasury department's decision, Independent think tank -- US' Official Monetary and Financial Institutions Forum Chairman Mark Sobel, in a tweet, said that China should not have been in the list in the first place.

Amid heightened trade tensions between China and US the Treasury Department had designated China as a currency manipulator in August 2019, a move that was criticized by most as it was felt that this would aggravate the trade war between the world's two big economies. UNI