The US remains concerned about China’s recent currency depreciation, a senior US Department of Treasury official said on Monday, adding that it was unclear whether US Secretary of the Treasury Steven Mnuchin would meet with any Chinese officials at the IMF and World Bank meetings this week.
“On Chinese currency, of course, we continue to closely monitor developments in the RMB [yuan], we remain concerned about some of the recent depreciation of the RMB,” the official told reporters on a conference call. “More broadly, we’re concerned about China’s turn away from more market-oriented policies and continued reliance on non-market mechanisms that impact the macroeconomic and trade environment.”
The official said these concerns would be laid out in the Department of Treasury’s semi-annual currency report, which is due to be released next week.
However, he declined to preview any details of the report.
Mnuchin said in July that he was closely monitoring the depreciation of the yuan for signs of manipulation.
US President Donald Trump has frequently accused China of manipulating its currency for a trade advantage.
The Treasury official said Mnuchin has no meetings scheduled with Chinese officials at the IMF and World Bank meetings on Bali, but his schedule was still being firmed up.
Mnuchin’s normal Chinese counterpart on trade-related issues, Vice Premier Liu He (劉鶴), will not attend the meetings, so there are unlikely to be trade discussions, the official said.
China normally sends People’s Bank of China (PBOC) Governor Yi Gang (易綱) and Chinese Minister of Finance Liu Kun (劉昆) to IMF and World Bank gatherings.
It is possible Mnuchin would meet with them, but they would likely discuss topics other than trade, the official added.
Meanwhile, IMF chief economist Maurice Obstfeld yesterday said that he was not concerned about the Chinese government’s ability to defend its currency despite the recent depreciation of the yuan.
“No, I don’t think it’s a problem,” Obstfeld said, when asked about the issue on the sidelines of a news conference at the IMF and World Bank annual meetings on Bali, Indonesia.
However, Obstfeld also told the news conference that Beijing would face a “balancing act” between actions to shore up growth and ensure financial stability.
The yuan has faced strong selling pressure this year, losing more than 8 percent from March to August at the height of market worries, though it has since pared losses as authorities stepped up support.
The PBOC yesterday fixed the yuan’s official mid-point for trading at 6.9019 per US dollar, edging close to the psychologically important 7 barrier and helping to send Asian stocks to a 17-month low.
Obstfeld said financial markets have overly emphasized short-term movements in the Chinese currency, adding that the yuan has often quickly recovered from periods of volatility in recent years.
The IMF has been recommending that Chinese authorities de-emphasize the quantity of growth to focus more on its quality and sustainability to allow the economy to better withstand shocks, Obstfeld said.
While government officials have been moving to rein in China’s credit expansion, it was understandable they would take steps to boost growth in the face of trade tensions with the US, and these have impacted short-term economic growth, affecting the yuan, he said.
“They do have to balance those actions against the need to achieve a more stable financial sector, to achieve more deleveraging, and they have to exert better control over local government financing. It’s definitely going to be a balancing act for them,” he added.
Stephen Garrett, a 27-year-old graduate student, always thought he would study in China, but first the country’s restrictive COVID-19 policies made it nearly impossible and now he has other concerns. The cost is one deterrent, but Garrett is more worried about restrictions on academic freedom and the personal risk of being stranded in China. He is not alone. Only about 700 American students are studying at Chinese universities, down from a peak of nearly 25,000 a decade ago, while there are nearly 300,000 Chinese students at US schools. Some young Americans are discouraged from investing their time in China by what they see
MAJOR DROP: CEO Tim Cook, who is visiting Hanoi, pledged the firm was committed to Vietnam after its smartphone shipments declined 9.6% annually in the first quarter Apple Inc yesterday said it would increase spending on suppliers in Vietnam, a key production hub, as CEO Tim Cook arrived in the country for a two-day visit. The iPhone maker announced the news in a statement on its Web site, but gave no details of how much it would spend or where the money would go. Cook is expected to meet programmers, content creators and students during his visit, online newspaper VnExpress reported. The visit comes as US President Joe Biden’s administration seeks to ramp up Vietnam’s role in the global tech supply chain to reduce the US’ dependence on China. Images on
New apartments in Taiwan’s major cities are getting smaller, while old apartments are increasingly occupied by older people, many of whom live alone, government data showed. The phenomenon has to do with sharpening unaffordable property prices and an aging population, property brokers said. Apartments with one bedroom that are two years old or older have gained a noticeable presence in the nation’s six special municipalities as well as Hsinchu county and city in the past five years, Evertrust Rehouse Co (永慶房產集團) found, citing data from the government’s real-price transaction platform. In Taipei, apartments with one bedroom accounted for 19 percent of deals last
US CONSCULTANT: The US Department of Commerce’s Ursula Burns is a rarely seen US government consultant to be put forward to sit on the board, nominated as an independent director Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker, yesterday nominated 10 candidates for its new board of directors, including Ursula Burns from the US Department of Commerce. It is rare that TSMC has nominated a US government consultant to sit on its board. Burns was nominated as one of seven independent directors. She is vice chair of the department’s Advisory Council on Supply Chain Competitiveness. Burns is to stand for election at TSMC’s annual shareholders’ meeting on June 4 along with the rest of the candidates. TSMC chairman Mark Liu (劉德音) was not on the list after in December last