“In view of the commitment during President Hu’s state visit that China will intensify its efforts to expand domestic demand and further enhance exchange rate flexibility, the Treasury has concluded that the standards identified in Section 3004 of the Act during the period covered in this report has not been met with respect to China,” said a statement on the Treasury Department’s website.
The statement added, “Treasury’s view, however, is that progress thus far is insufficient and that more rapid progress is needed.”
It pledged to “continue to closely monitor the pace of appreciation” of the yuan.
The decision by the Treasury comes as the United States, now reluctantly, continues to accuse China of manipulating the yuan, which floods the country with cheap exports and costs the nation jobs.
U.S. lawmakers have fought in vain to get the Obama administration to clamp down on China over the yuan, but to no effect.
“China’s currency practices harm ranchers, farmers, and exporters across America and around the world,” said U.S. Senator Max Baucus (D-Montana) in a public statement.
“China has been given free pass on its currency practices for far too long. We need to hold China and our other trading partners accountable for their actions.”
What should the United States do to China?
“It would be silly for us to declare China a currency manipulator,” Damian Daio, an economics professor at University of San Francisco, told Politically Illustrated. “We need to build strong trade relations with other nations, mainly Canada, to squeeze China’s growth.”
