Geithner said Obama believes that China is manipulating its currency, an admission that the Bush administration was unwilling to make for fears of stanching needed inflows of Chinese capital. EUR/USD jumped to 1.3005 on the comment. Here are the comments:
“President Obama — backed by the conclusions of a broad range of economists — believes that China is manipulating its currency,” Geithner said. “President Obama has pledged as president to use aggressively all the diplomatic avenues open to him to seek change in China’s currency practices.”
Also crossing the wires is news from Russia that they will maintain their managed float but allow the rouble to weaken to 41.0 from 37.2. They say they do not paln on changing the boundry of their float in the coming months. Some see this as resulting in the need for less Russian intervention to support the Rouble with the new, wider rate corridor.
