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US Treasury refrains from labeling any major trading partners as FX manipulators


According to a report released by the US Treasury Department, no major US trading partners were labeled as FX manipulators. 

Key Takeaways:

“Currency report concludes that Vietnam and Taiwan continue to meet all three manipulation criteria for enhanced engagement under 2015 law.”

“Reached agreement with Vietnam in July to address treasury’s concerns, is satisfied with the progress made to date.”

“Will continue enhanced engagement with Taiwan that was launched in May.”

“Urging Taiwan to develop a specific action plan to address causes of currency undervaluation and external imbalances.”

“Switzerland no longer meets all three criteria for enhanced analysis.”

“Will continue to conduct in-depth analysis of Switzerland until it no longer meets all three criteria under 2015 law for at least two consecutive reports.”

“Will continue enhanced bilateral engagement with Switzerland to discuss policy options to address underlying causes of external imbalances.”

“Put 12 economies on the ‘monitoring list’ for currency practices – China, Japan, Korea, Germany, Ireland, Italy, India, Malaysia, Singapore, Thailand, Mexico and Switzerland.”

“China’s failure to publish foreign exchange intervention data, lack of transparency make it an ‘outlier’ among major economies, will closely monitor activities of state-owned banks.”

“The Treasury has raised concerns about China’s practices with Chinese counterparts.”

“Closely monitoring China’s data and policies, concerned about persistent ‘very large and persistent’ bilateral trade surplus.”

“Particularly focused on increased intervention in currency markets by china’s state-owned banks over last 1-1/2 years.”

“Adjusting thresholds for three major manipulation criteria under 2015 law.”

“Trade surplus threshold shifted to $15 bln goods and services surplus from $20 bln goods surplus.”

“Current account surplus threshold shifted to 3% of GDP or estimated current account gap of 1%, from previous 2% of GDP surplus.”

“Now measuring the persistence of net foreign exchange purchases over 8 of 12 months vs 6 of 12 months previously.”

“5 countries – Singapore, Taiwan, Vietnam, India and Switzerland – intervened in forex market in ‘sustained, asymmetric manner’ to weaken currencies over the 4 quarters through June 2021.”



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