By Dan Burns
(Reuters) -No major U.S. trading partner manipulated its currency in 2024, the Treasury Department said on Thursday in the first semi-annual currency report of President Donald Trump’s new administration, although its “monitoring list” of countries warranting close attention grew to nine with the addition of Ireland and Switzerland and it issued a stern warning to China.
While it did not label China a currency manipulator for now despite “depreciation pressure” facing its currency, the yuan, Treasury said the country “stands out among our major trading partners in its lack of transparency around its exchange rate policies and practices.”
“This lack of transparency will not preclude Treasury from designating China if available evidence suggests that it is intervening through formal or informal channels to resist (yuan) appreciation in the future,” Treasury said in a statement.
Treasury said China, Japan, South Korea, Taiwan, Singapore, Vietnam, Germany, Ireland and Switzerland were on its monitoring list for extra foreign exchange scrutiny.
Countries that meet two of the criteria – a trade surplus with the U.S. of at least $15 billion, a global account surplus above 3% of GDP and persistent, one-way net foreign exchange purchases – are automatically added to the list. Ireland and Switzerland were added due to their large trade and current account surpluses with the U.S.
Trump in his first term labeled China a manipulator in August 2019, a move made then – as now – amid heightened U.S.-China trade tensions. The Treasury Department dropped the designation in January 2020 as Chinese officials arrived in Washington to sign a trade deal with the U.S.
The latest report covers the final full year of the administration of Trump’s predecessor, Democrat Joe Biden, who over his four-year term never labeled any trading partner a currency manipulator but raised similar concerns over China’s behavior and lack of transparency.
The report was released hours after Trump spoke with China’s leader Xi Jinping for the first time since returning to the White House amid an even more tense trade standoff between the world’s two largest economies, and more recently a battle over critical minerals. The countries struck a 90-day deal on May 12 to roll back some of the triple-digit, tit-for-tat tariffs they had placed on each other since Trump’s January inauguration.
(Reporting by Dan Burns, Andrea Shalal and Ann Saphir;Editing by Andrea Ricci)
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