Friday, February 24, 2017
Trump called China the 'grand champions' of currency manipulation — and China struck back
BEIJING — China on Friday said it had no intention of using currency devaluation to its advantage in trade, responding to an assertion from US President Donald Trump that China was the "grand champions" of currency manipulation.
Trump said in an interview with Reuters on Thursday he had not "held back" in his assessment that China manipulated its yuan currency, just hours after his new Treasury secretary pledged a more methodical approach to analyzing Beijing's foreign-exchange practices.
Chinese Foreign Ministry spokesman Geng Shuang said he hoped the US could "fully and correctly" view the exchange-rate issue.
"China has no intention of seeking foreign trade advantages via an intentional devaluation of the renminbi. There is no basis for the continued devaluation of the renminbi," he told a daily media briefing in Beijing.
"If you must attach the label 'grand champion' to China," Geng added, "then I think China is a grand champion. But we are the grand champions of economic development."
The Foreign Ministry has no say in currency policy, but it is the only Chinese government department that holds a daily briefing that foreign reporters attend.
China's central bank, the People's Bank of China, did not respond to a request for comment.
Trump has frequently accused China of keeping its currency artificially low against the dollar to make Chinese exports cheaper, "stealing" American manufacturing jobs.
But he did not act on a campaign promise to declare China a currency manipulator on his first day in office.
The yuan fell 6.6% against the US dollar in 2016, its biggest annual drop since 1994, as it was pressured by worries about slowing Chinese growth and more recently by a resurgent dollar, which has spurred capital outflows from many emerging markets.
Chinese authorities have taken a raft of steps in recent months to curb capital flight to support its weakening yuan while trying to bring in more foreign investment.
Geng said there was no basis for the continued devaluation of the renminbi and he hoped "the relevant side can fully and correctly view the renminbi exchange-rate issue."
But China's foreign-exchange regulator this month said the economy still faced weak global demand and financial-market volatility caused by expectations of further interest-rate rises by the US Federal Reserve.
(Reporting by Ben Blanchard; Writing by Philip Wen; Editing by Robert Birsel)