Geithner Changes Mind, Says China Not Manipulating Currency
The White House will not cite China as a nation that manipulates its currency in order to gain an unfair trade advantage, the Associated Press is reporting.
This report -- which comes from Treasury Secretary Tim Geithner's agency -- comes in stark contrast to statements made by Geithner during his Senate confirmation hearing when he said that President Obama does indeed believe the Chinese are fooling with their currency. This policy is also in line with the Bush administration and US manufacturers for many years.
Geithner said in January that the president wanted tougher enforcement of currency-manipulators so that “countries like China cannot continue to get a free pass for undermining fair trade principles.”
Since then, apparently, China has really cleaned up its act.
In a statement accompanying today's report, Geithner said China has taken a number of actions in recent months to “enhance exchange rate flexibility.”
China has allowed its currency, the yuan, to rise in value against the dollar by 16.6 percent between the end of last June and the beginning of February.
U.S. manufacturers, however, still believe the yuan is undervalued between 20 percent and 40 percent, part of the cause of the big trade deficit between China and the U.S.
China is the largest holder of U.S. debt.
April 15, 2009; 5:06 PM ET
Categories: The Ticker | Tags: China, Obama, Tim Geithner, trade, trade deficit
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