Washington Reverses Brand On China As Currency Manipulator

As predictably as the US President Donald Trump has become, he has arm twisted his way into getting China back into line. While some time back, US Treasury Department had declared China would be considered a currency manipulator, the department has finally retracted the statement.  This is being done in the wake of Washington and Beijing signing the first phase of their trade agreement.

The US has been for months accusing China was devaluing the Yuan, to make its goods cheaper for foreign buyers. Making a media statement US Treasury Secretary, Steven Mnuchin has said that, "China has made enforceable commitments to refrain from competitive devaluation, while promoting transparency and accountability.”

While in 2015 election campaign, Trump at that time had vowed to label China as a currency manipulator in the wake of declining US manufacturing, he didn’t do so after taking office.  It has been confirmed that Treasury Secretary Steven Mnuchin eventually made the move, after pressure from the Trump. This is the first time that the US has officially branded a country as a currency manipulator since 1994.

It has been observed that since August, the value of the yuan had appreciated, when the US officially termed China has a currency manipulator. Tensions that time were high between Beijing and Washington as China was out to retaliate against Trump's threat to put a 10% tariff on another $300bn (£246.7bn) of Chinese imports.

At that time, China could blame the dipping currency on the weakening market situation. Beijing also suggested that investors were concerned about the escalating trade war between the two countries. 

Under the US definition, currency manipulation is the deliberate effort by a country to influence the exchange rates between its currency and the US dollar to gain an "unfair competitive advantage in international trade".