US Skips to Label China as Currency Manipulator Again, Blasts Policies/ Newslooks/ WASHINGTON/ J. Mansour/ Morning Edition/ The U.S. stopped short of labeling China a currency manipulator in its latest Treasury report but sharply criticized Beijing’s lack of transparency in exchange rate policies. The decision comes amid renewed trade negotiations between Presidents Trump and Xi.
US China Currency Policy Quick Looks
- Treasury’s latest report declines to name China a currency manipulator.
- China is singled out for poor transparency in exchange rate practices.
- U.S. Treasury warns that manipulation evidence could emerge by fall.
- Trump’s renewed talks with Xi Jinping influenced the decision.
- Tariffs on both sides have been temporarily reduced to restart negotiations.
- Treasury Secretary Bessent vowed tough countermeasures against future currency abuse.
- China was last labeled a manipulator under Trump in 2019.
- Currency issues remain key in ongoing trade tensions between the U.S. and China.
US Skips to Label China as Currency Manipulator, Blasts Policies
Deep Look
US Refrains From Labeling China Currency Manipulator, But Slams Its Transparency Practices
WASHINGTON — In its latest semiannual report to Congress, the U.S. Treasury declined to formally label China a currency manipulator, but issued a sharp rebuke over Beijing’s continued lack of transparency in how it manages the value of its currency, the renminbi (RMB).
The report — titled Macroeconomic and Foreign Exchange Policies of Major Trading Partners of the United States — comes at a pivotal moment as President Donald Trump reengages with China on trade issues. His recent call with Chinese President Xi Jinping has rekindled hopes for a new agreement and temporarily paused escalating tariffs.
Currency Label Avoided, But Not Forgotten
Though China avoided being added to the currency manipulation blacklist this round, U.S. officials made clear that scrutiny remains high. A senior Treasury official said that evidence of manipulation could still be found later this year, leaving the door open for a reassessment in the fall.
China was last labeled a currency manipulator by the Trump administration in 2019, marking the first such designation since 1994. That label was eventually removed in early 2020, but currency practices have remained a sticking point between the two economic superpowers.
Bessent Sends Strong Message on Trade Imbalance
Treasury Secretary Scott Bessent emphasized that the administration is watching closely for any behavior that could skew fair trade.
“The administration has put our trading partners on notice that macroeconomic policies that incentivize an unbalanced trading relationship with the United States will no longer be accepted,” Bessent said.
He added that Treasury is prepared to use “all available tools” to address unfair currency policies, making it clear that future manipulative practices would meet strong countermeasures.
Transparency Lacking in China’s Currency Policy
Despite not being designated a manipulator, China was heavily criticized in the report for failing to be transparent in its foreign exchange operations. According to the Treasury, China remains an outlier among major trading partners for not disclosing key aspects of how it manages the RMB.
This lack of visibility continues to raise concerns among U.S. officials who argue that Beijing could be using opaque practices to gain unfair trade advantages — such as weakening its currency to boost exports.
Trade Talks Resume Amid Tariff Reductions
The decision comes on the heels of President Trump’s phone conversation with President Xi — the first since Trump returned to the White House for his second term. Trump described the call as “very positive,” and announced that trade teams from both countries will meet soon to resume stalled negotiations.
Following the call, Trump agreed to lower tariffs on Chinese imports from 145% to 30% for 90 days, allowing space for talks. In a reciprocal move, China slashed tariffs on U.S. goods from 125% to 10%.
The mutual reduction of tariffs is seen as a goodwill gesture aimed at preventing further escalation and calming volatile global markets. However, the broader disputes over technology, trade balance, and currency manipulation still loom.
Trade and Currency Still on Collision Course
While Treasury stopped short of the formal currency manipulation designation, the report signals that China remains under intense scrutiny. The U.S. is still deeply concerned about Beijing’s trade tactics, including its long-standing trade surplus with the U.S., its approach to rare earth exports, and its digital trade restrictions.
Trump’s administration has repeatedly expressed its desire to decouple certain parts of the U.S. economy from Chinese supply chains — a move that would be deeply affected by currency fluctuations and trade balances.
The next Treasury report in the fall will be closely watched, especially if China does not improve its currency transparency or if tensions in trade talks escalate once more.
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