Japan, China remain on U.S. 'monitoring list' for currency
- Author: Zachary Reyes Apr 19, 2017,
Apr 19, 2017, 0:09
On the topic of Trump's recent waffling on many platforms he held during his campaign, McConnell said that the felt Trump is still "learning the job". Trump's threat to slap harsh tariffs on Chinese goods has given way to a bid to mend fences with Beijing.
Commerce Secretary Wilbur Ross has said that the issue of "currency misalignment" - which could also include unintentional devaluations - will be addressed in a study of trade abuses by nations that run large surpluses with the USA, which is due to be ready in June.
The checklist also includes Japan, South Korea, Taiwan, and Switzerland.
Trump has said some U.S. trading partners, particularly China, manipulated their currency, but has since backed off that claim and acknowledged that China had not weakened the yuan to make its exports cheaper. The Treasury acknowledged that China has been intervening in currency markets to prevent a depreciation of the yuan, though it said its selling of foreign currency reserves abated in the early part of this year.
Additionally, US Department of the Treasury established a "monitoring list" of major trading partners that merit close attention to their currency practices.
Treasury Secretary Steven Mnuchin said ensuring a level playing field for U.S. businesses is an "essential component of this administration's strategy".
The Trump administration urged China to buy more American goods and services to reduce the gaping trade imbalance after declining to label the world's second-largest economy a currency manipulator.
The two countries' trade imbalance is easing as middle-income Chinese generate a huge demand for imported products, according to both U.S. and Chinese official data.
The US report said Asia's fourth-largest economy posted US$28 billion in goods surplus with the USA last year, with its current account surplus accounting for 7 percent of the country's gross domestic product. Its surplus with the United States totaled $65 billion previous year.
The report also called on Japan to do more "to revive domestic demand and combat low inflation while avoiding a return to export-led growth". In accepting the Republican nomination last summer, Trump called China the "greatest currency manipulators ever"!
Like Korea, China was not labeled a currency manipulator. But on Wednesday, he backed away from that promise in a Wall Street Journal interview.
Trump did say he thought the dollar was "getting too strong" - a comment that sent the USA currency falling, though it subsequently rebounded.
That helped to drive down the 10-year U.S. Treasuries yield to 2.200 percent US10YT=RR , its lowest level since mid-November from around 2.228 percent on Thursday before a market holiday on Friday. Economists say the US currency could rise further as the Federal Reserve raises interest rates.