9 Countries Make the US Treasury’s Monitoring List on Currency Practices
Posted on 05/28/2019
The United States Department of the Treasury delivered a May 2019 report to U.S. Congress called “Macroeconomic and Foreign Exchange Policies of Major Trading Partners of the United States.” The U.S. Treasury reviewed and assessed the policies of an expanded set of 21 major U.S. trading partners. The analysis concluded that while the currency practices of nine countries were found to require close attention, no major U.S. trading partner met the relevant 2015 legislative criteria for enhanced analysis during the period covered by the Report. The U.S. Treasury found that nine major trading partners continue to warrant placement on Treasury’s “Monitoring List” of major trading partners that merit close attention to their currency practices: China, Germany, Ireland, Italy, Japan, Korea, Malaysia, Singapore, and Vietnam.
U.S. Treasury Secretary Steven T. Mnuchin commented in a press release that “Additionally, Treasury will continue its enhanced bilateral engagement with China regarding exchange rate issues, given that the RMB has fallen against the dollar by eight percent over the last year in the context of an extremely large and widening bilateral trade surplus.”
China does not disclose its foreign exchange intervention. The U.S. Treasury estimates that direct intervention by the People’s Bank of China in 2018 has been limited. However, China has a long history of facilitating an undervalued currency through protracted, large-scale intervention in the foreign exchange market.
