US Treasury refrains from labeling any major trading partners as FX manipulators
|According to a report released by the US Treasury Department, no major US trading partners were labeled as FX manipulators.
Key Takeaways:
"Currency report concludes that Vietnam and Taiwan continue to meet all three manipulation criteria for enhanced engagement under 2015 law."
"Reached agreement with Vietnam in July to address treasury's concerns, is satisfied with the progress made to date."
"Will continue enhanced engagement with Taiwan that was launched in May."
"Urging Taiwan to develop a specific action plan to address causes of currency undervaluation and external imbalances."
"Switzerland no longer meets all three criteria for enhanced analysis."
"Will continue to conduct in-depth analysis of Switzerland until it no longer meets all three criteria under 2015 law for at least two consecutive reports."
"Will continue enhanced bilateral engagement with Switzerland to discuss policy options to address underlying causes of external imbalances."
"Put 12 economies on the 'monitoring list' for currency practices - China, Japan, Korea, Germany, Ireland, Italy, India, Malaysia, Singapore, Thailand, Mexico and Switzerland."
"China's failure to publish foreign exchange intervention data, lack of transparency make it an 'outlier' among major economies, will closely monitor activities of state-owned banks."
"The Treasury has raised concerns about China's practices with Chinese counterparts."
"Closely monitoring China's data and policies, concerned about persistent 'very large and persistent' bilateral trade surplus."
"Particularly focused on increased intervention in currency markets by china's state-owned banks over last 1-1/2 years."
"Adjusting thresholds for three major manipulation criteria under 2015 law."
"Trade surplus threshold shifted to $15 bln goods and services surplus from $20 bln goods surplus."
"Current account surplus threshold shifted to 3% of GDP or estimated current account gap of 1%, from previous 2% of GDP surplus."
"Now measuring the persistence of net foreign exchange purchases over 8 of 12 months vs 6 of 12 months previously."
"5 countries - Singapore, Taiwan, Vietnam, India and Switzerland - intervened in forex market in 'sustained, asymmetric manner' to weaken currencies over the 4 quarters through June 2021."
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.