US pledged to monitor China and yuan

The US authorities have promised to closely monitor China’s foreign exchange policy and the yuan exchange rate, it follows from the latter during the presidency Donald Trump currency report prepared by Treasury Department . Excerpts from the document are given by Bloomberg .

The Ministry of Finance recognized Switzerland and Vietnam as currency manipulators. This status is assigned to countries whose governments and central banks artificially restrain the strengthening of the national currency in order to give advantages to exporters in foreign markets.

The Swiss and Vietnamese authorities resorted to similar measures at the beginning of the year, even before the introduction of restrictions to combat the coronavirus pandemic. At the same time, China is not on the list of currency manipulators, which, like South Korea, Thailand and India, will be closely monitored by Washington.

According to the current American rules, a foreign exchange manipulator is recognized as a country that has a positive current account balance (reflects the receipt and consumption of foreign exchange for goods and services) exceeds two percent of national GDP, the trade balance (reflects only goods) reaches $ 20 billion. and at the same time Central Bank performs foreign exchange interventions in the amount of at least two percent of GDP.

In turn, the former head of Federal Reserve System Janet Yellen , nominated by the US President-elect Joe Biden for the post of Minister of Finance, professes a deeper approach to the analysis of monetary policy of foreign states and endowing them with the status of a currency manipulator. In this regard, analysts do not rule out revising the current decision after the new White House administration comes into office.