US says China not currency manipulator
WASHINGTON (AFP) - The United States (US) Treasury ruled on Tuesday that China does not manipulate its currency, but said nevertheless that the yuan remains undervalued.
In a twice-yearly finding to answer congressional critics of China's overwhelming bilateral trade advantage, the Treasury said Beijing did not meet the definition of a currency manipulator under US law, which could spark US trade sanctions.
The Treasury argued that China knows that an appreciating currency is in its own interest, and said the yuan, gained 9.3 per cent against the dollar between June 2010 and November 2012.
Measuring the real effective exchange rate - which weighs China's cost-competitiveness relative to its trade partners - the Treasury said the renminbi gained 6.2 per cent in 2011, and was flat this year, but was up 27 per cent since mid-2005.