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US signals growing impatience with China's currency policies

Updated On: Sep 17, 2010

On Thursday, Timothy Geithner, US Treasury secretary, told the Senate Banking Committee that he encouraged the US Congress to pile pressure on China in order to force it to allow the yuan to rise and said the US administration was examining a range of tools to urge Beijing to act.

Geithner told the committee that the administration would use "all tools available" to improve trade imbalances, including "direct engagement" between President Obama and China's senior leaders.

Raising the stakes as part of a tougher line on China's policies, Geithner also said the United States would use a Group of 20 summit in Seoul in November to try to mobilize trading partners to get Beijing to let the yuan strengthen faster.

The hearings come with Obama poised to meet with Chinese Premier Wen Jiabao next week on the sidelines of the UN General Assembly in New York, after a parade of US officials visited Beijing over the past few weeks to condemn rampant intellectual property theft and press the US case on currency.

However, even as Geithner talked tough in testimony before two key congressional panels, saying he shared lawmakers' frustrations, he urged caution over any measures that might further strain US-China relations.

Trading concerns that the United States has with China are issues that other countries are dealing with as well. On Wednesday, Japan intervened in the foreign exchange markets to hold down the yen for the first time in six years after expressing concern about the effects of Chinese market intervention.


Sources;

US turns up heat over renminbi [Financial Times, 16 September 2010]

Geithner vows to take China currency dispute to G20 [The Economic Times, 17 September 2010]

US Lawmakers Call for Tougher Action on Chinese Currency [Voice of America, 16 September 2010]







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