Treasury Department drops China's currency manipulator designation
Trump and Chinese President Xi Jingping. Photo: BRENDAN SMIALOWSKI/AFP via Getty Images.
The Treasury Department announced Monday that China will no longer be designated as a currency manipulator, just two days before President Trump and Vice Premier Liu He are set to sign "phase one" of a long-awaited trade deal, CNBC reports.
Why it matters, per Axios' Felix Salmon: China never fit the textbook definition of being a currency manipulator. The decision to apply the label was a political one — as was the decision to remove it.
The big picture: China was added to the list just five months ago after its government allowed the yuan to slip below a 7-to-1 dollar ratio for the first time in over a decade. The move was largely symbolic, but helped ratchet up trade tensions between the two countries.
- China will now be moved to the "monitoring list," joining nine other countries including Germany, Ireland, Italy, Japan, South Korea, Malaysia, Singapore, Switzerland and Vietnam.
- Treasury Secretary Steven Mnuchin said in a statement: "China has made enforceable commitments to refrain from competitive devaluation, while promoting transparency and accountability."
Go deeper: The stakes of a swift U.S.-China decoupling