Trump admin. declines to brand China a currency manipulator

Violet Tucker
April 15, 2017

It's rare for American leaders to link trade or currency disputes to broader worldwide security efforts against countries such as North Korea.

Washington D.C. [United States], Apr. 15 (ANI): The Trump administration has not labeled any country, including China, as a currency manipulator in a report examining exchange rate fluctuations. And his threat to slap harsh tariffs on Chinese goods has given way to a bid to mend fences with Beijing. Nor has the USA imposed punitive tariffs on foreign countries or US companies that move jobs offshore, as Trump has threatened.

"The president is beginning to adjust his policies to economic reality", says Joshua Meltzer, a specialist in global trade and a senior fellow at the Brookings Institution.

"Trump's comments came at a time when some had begun to think that perhaps the president was not as supportive of a weak dollar as initially perceived", said Shin Kadota, senior strategist at Barclays in Tokyo. During the campaign, Donald Trump accused China over and over of manipulating its currency and he pledged to retaliate.

In the Trump campaign's "contract" with American voters he promised, "I will direct the Secretary of the Treasury to label China a currency manipulator" in the first 100 days of his presidency.

Designating a country as a currency manipulator doesn't immediately trigger any penalties, but it is seen by other governments as a provocation.

In his interview with the Journal, Trump also said he would prefer that the Federal Reserve keep interest rates relatively low.

"What we've seen is investors from the rest of the world putting more money in U.S. Treasuries" due to geopolitical concerns, Warne said.

The move was expected as Trump earlier this week had said that China was not a currency manipulator. It was clear, under the department's standards, that China was not guilty. North Korea poses a harder test than Syria: Asian allies will want to see that the Trump administration is as adept at diplomacy on the Korean peninsula as it is at projecting military power in the Middle East.

"They're not currency manipulators", he said in an interview.

On the campaign trail, Trump had called North Atlantic Treaty Organisation "obsolete".

President Trump's economic policy pronouncements have taken some twists and turns this week.

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In fact, the president's trade stance on China has taken an even softer tone since he met last week with President Xi Jinping.

When Trump goes to China, he could surprisingly catalyze a re-embrace of America's free enterprise heritage. The White House will also need to be willing to risk an increase in tensions with China by imposing secondary sanctions on Chinese banks and businesses that are the lifeline of the North Korean economy.

All that was manna for the wheeling-dealing president, who promptly said China was not manipulating its currency - in spite of promising to make that declaration on day one.

And so it is - these days - with Russian Federation and China. The accusation had formed a basis of Trump's argument for lost American jobs, on the grounds that an undervalued currency was boosting Chinese exports and leading to artificially low prices, all at US manufacturers' expense.

On the currency front, the US dollar is trading at 109.17 yen compared to the 109.03 yen it fetched at the close of NY trading on Wednesday.

It was "certainly possible" Putin knew about the sarin attack, Trump said. He's already withdrawn from an ambitious Asia-Pacific trade pact negotiated by the Obama administration.

The U.S. decision "is a very desirable outcome for the development of bilateral trade in the future", the association said in a statement.

Still, free-trade advocates would feel far more encouraged if the administration worked within existing trade pacts rather than tearing them up.

Trump's Syria strikes and tough talk on Russian Federation has served the White House in diverting the public's attention from his campaign's ties with Moscow, a matter that is now under investigation by the FBI. But plenty of other Americans have a vital stake in preserving cordial trade relations.

President Obama did not heed USA defense leaders' advice to more forcefully challenge China's militarization of the South China Sea and North Korea, and Chinese muscle and money have encouraged key US allies, the Philippines and Malaysia, to shift their favor toward Beijing.

Indeed, the mounting domestic opposition to President Vladimir Putin's autocratic rule at home - as manifested in popular protests in cities across Russian Federation - creates a new pressure point that the US could leverage through a heightened force posture in Europe and more robust pressure for Russian Federation to conform to global law by severing dealings with the outlaw Syrian regime. A NAFTA overhaul would likely disrupt their operations. "The greatest in the world", Trump said at a Florida rally a year ago.

"Look at the whole board".

Other reports by Guamnewswatch

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