US Treasury Secretary Timothy Geithner has said he is not satisfied with China’s moves to loosen its grip on the yuan, ahead of an appearance before US lawmakers on ways to pressure Beijing.
Geithner, who will testify before the US House Ways and Means Committee on Thursday, told the Wall Street Journal in an interview that Beijing had done “very little” since pledging in June to let the yuan trade more freely.
When asked in the interview, conducted on Friday and posted on the newspaper’s Web site yesterday, whether he was satisfied with China’s progress on the issue, Geithner replied: “Of course not.”
“China took the very important step in June of signaling that they’re going to let the exchange rate start to reflect market forces. But they’ve done very, very little, they’ve let it move very, very little in the interim,” he said. “It’s very important to us, and I think it’s important to China, I think they recognise this, that you need to let it move up over a sustained period of time.”
China made the June pledge following intense pressure from the US, Europe and other trading partners for a stronger currency. The yuan had until then been effectively pegged at about 6.8 to the US dollar since 2008.
Since then the yuan has appreciated about 1 percent against the greenback, angering US lawmakers who have been calling for steps against what they see as unfair Chinese trade practices.
The People’s Bank of China yesterday set the central parity rate — the middle of the currency’s allowed trading band — at 6.7509 to the US dollar, according to chinamoney.com.cn. The exchange rate can move up or down 0.5 percent on any given trading day.