The U.S. Treasury Department on Friday said no major U.S. trading partner met criteria to be named a currency manipulator during the four quarters through December 2022, as officials released a key foreign-exchange report.
The Treasury also said seven countries have spots on its monitoring list of major trading partners whose currency practices and economic policies warrant close attention.
China, South Korea, Germany, Malaysia, Singapore, Switzerland and Taiwan are on Treasury’s latest list, with Japan removed after having a spot in the department’s November report.
Switzerland is new to the list, after being under “enhanced analysis” in November, but the other six countries were also on it November.
From MarketWatch’s archives (April 2021): U.S. Treasury removes forex manipulation label from Switzerland, Vietnam
The Treasury also reiterated its call for increased transparency from China.
A senior Treasury official told reporters that the present global macroeconomic circumstances, elevated inflation, monetary tightening to slow demand, and dollar appreciation have reduced concerns about current account surpluses, but the department remains vigilant to countries’ currency practices.
The report, which is issued twice a year, is closely watched for whether other countries are designated as currency manipulators or flagged for other problematic practices that affect trade.
China has long faced calls that it should be declared a currency manipulator, and the Trump administration did in fact apply that label in August 2019, but then stepped back from that decision in January 2020.
The latest foreign-exchange report comes as Washington and Wall Street have increasingly focused on the issue of “de-dollarization” in recent months. That refers to threats to the U.S. dollar’s
standing as the dominant global currency, especially as there are Chinese and Russian efforts to denominate more trade in Chinese yuan
with Beijing pushing in particular for more oil and natural gas to be traded in its currency.
On Tuesday, the yuan fell to a six-month low against the greenback after China’s central bank unexpectedly cut a series of interest rates to help boost confidence and shore up a wobbly post-COVID economic recovery.