US Treasury report brings a small reprieve to China in trade war
- Despite Trump’s claims, Treasury Department has declined to label China a currency manipulator
- Report finds that direct intervention by China’s central bank has been limited
There has not been much good news lately for China on the trade war front. This week brings a small relief.
Despite repeated accusations by US President Donald Trump that the country is a currency manipulator, his own Treasury Department declined to label it as such in its latest report to the US Congress. Not all is plain sailing for the Chinese, though.
The Treasury’s conclusion was perhaps foregone. International Monetary Fund chief Christine Lagarde earlier dismissed Trump’s claim that China was manipulating its currency, called the yuan, to gain a competitive advantage in trade against the United States.
Instead, much of the yuan’s depreciation in the past year, she said, could be attributed to the US dollar’s growing strength.
Even after Trump publicly and privately pressured US Treasury Secretary Steven Mnuchin to follow his lead, Mnuchin’s own staff informed him before the report’s release that they found little evidence to support the president’s claim.