Reuters: US Dollar Report: China yuan moves notable but it still undervalued-US

Reuters: US Dollar Report Reuters.com is your source for breaking news, business, financial and investing news, including personal finance and stocks. Reuters is the leading global provider of news, financial information and technology solutions to the world's media, financial institutions, businesses and individuals. // via fulltextrssfeed.com

China yuan moves notable but it still undervalued-US Jul 18th 2012, 18:24 WASHINGTON, July 18 | Wed Jul 18, 2012 2:24pm EDT WASHINGTON, July 18 (Reuters) - China has allowed the yuan to appreciate and trimmed its current account surpluses, but the United States believes the currency remains undervalued and will press the issue with the Chinese, Treasury Undersecretary Lael Brainard said on Wednesday. "We have seen progress in terms of addressing the undervaluation of the currency but we believe the currency remains undervalued," she said in a speech in Washington. A drop of China's current account surplus by more than 6 percentage points of GDP, reflecting an 11 percent appreciation of the yuan against the dollar, represented "progress that is worth acknowledging," said Brainard. "But for our purposes, we need to see China move to a market-determined exchange rate and to, essentially, fundamentally alter its system in a way that it allows interest rates to be market-determined (and) allows capital flows to be market-determined," she said. Further indications of progress would include much less accumulation of foreign reserves, a decline of intervention in forex markets and the opening of tightly controlled financial markets, added Brainard. "We are going to keep pressing on this issue and making sure that it's a one-way movement toward a market-determined exchange rate," she added. U.S. lawmakers and manufacturers argue China has gained a competitive edge over American manufacturers by keeping the yuan weak to boost exports. Republican presidential hopeful Mitt Romney has vowed to slap a "currency manipulator" label on China from his first day in office if he wins the White House. The Treasury Department said in a semiannual report on May 25 that labeling China a currency manipulator under U.S. law was not warranted, noting that the yuan has risen against the dollar, China's trade surplus has dropped and Beijing has committed to further currency reforms. Link this Share this Digg this Email Reprints

You are receiving this email because you subscribed to this feed at blogtrottr.com. If you no longer wish to receive these emails, you can unsubscribe from this feed, or manage all your subscriptions