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U.S. Declares China is No Longer a “Currency Manipulator”

U.S. Declares China is No Longer a “Currency Manipulator”

China agrees to buy $200 billion in U.S. energy, manufactured goods as part of trade deal.

https://twitter.com/POTUS/status/850144244107022336

Ahead of all the pomp and circumstance expected at the trade agreement signing ceremony this week, the Treasury Department has removed the designation of China as a “currency manipulator.”

The Treasury Department released its long-delayed currency report on Monday afternoon, providing its first public analysis of China’s currency practices since it designated China a manipulator in August at the direction of Mr. Trump. The report noted that China — which Mr. Trump had accused of weakening its currency, the renminbi, to make its goods cheaper to sell overseas — had made important commitments regarding the renminbi as part of the new trade agreement and that its value had appreciated since September.

“China has made enforceable commitments to refrain from competitive devaluation, while promoting transparency and accountability,” Treasury Secretary Steven Mnuchin said in a statement.

The signing ceremony is scheduled for this Wednesday.

The deal is aimed at de-escalating the tit-for-tat tariff war the two countries have engaged in since 2018.

“China has made enforceable commitments to refrain from competitive devaluation, while promoting transparency and accountability,” US Treasury Secretary, Steven Mnuchin, said.

President Donald Trump has repeatedly accused China of allowing the value of the yuan to fall, making Chinese goods cheaper.

But, on Monday, the US said that the value of the yuan had appreciated since August, at the height of the trade war.

Mr Mnuchin also said that China had made “enforceable commitments” to refrain from devaluation and to share more information about its exchange rates.

“In this context, Treasury has determined that China should no longer be designated as a currency manipulator at this time,” the Treasury said.

The trade deal includes an agreement with China to buy $200 billion of U.S. goods over two years in four industries.

The target for manufactured goods purchases will be the largest, worth around $75 billion. China will also promise to buy $50 billion worth of energy, $40 billion in agriculture and $35 billion to $40 billion in services, the three people said.

Analysts have speculated for weeks about what kinds of purchases China could make in these sectors.

“Energy products are specifically mentioned in the section on ‘Expanding Trade’ in the fact sheet produced by the USTR on Dec. 13, 2019,” said Moody’s Analytics chief Asia-Pacific economist Steve Cochrane. “So it seems like a good possibility to be included in the details of the phase one agreement to be signed on Wednesday.”

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Comments

notamemberofanyorganizedpolicital | January 15, 2020 at 3:31 pm

Schumer is SO Deranged!

The Friendly Grizzly | January 15, 2020 at 4:04 pm

I’m just cynical enough to think we – the peasantry – come out on the short end of things while the politicians and those wealthy enough to have no sense of patriotism come out on top.

There will still be intellectual property theft, bad quality control on medicines and food products, and slave labor. (I’m being diplomatic about “bad quality control” regarding food and medicine.)

    This is my issue as well.

    Currency manipulation is only part of the pie in the grand scheme. We need a crackdown on intellectual property theft. If China agrees to buy our tech only to reverse engineer and steal it then nothing is accomplished at all and may even worsen. However, in order to save China embarrassment, I could see some less public terms being agreed upon by the two leaders for exactly this issue. They probably will or should be leaked out later if that is the case…hopefully.

    That said, Schumer is also stupid and behind the curve again (because this won’t really be about currency manip).

The Friendly Grizzly | January 15, 2020 at 4:11 pm

Clarification: I’m referring to the latest trade deal, not the currency manipulation. That will continue; it will just be accepted.

notamemberofanyorganizedpolicital | January 15, 2020 at 4:21 pm

So does this mean the Congress Critters bribes from them will be worth less?

Monetary manipulation. Labor and environmental arbitrage. Intellectual property theft. Diversity. Pro-Choice. Progress. Well, at least they don’t conflate logical domains to force scientific prophecies.

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