A look at the move
Alan Beattie in the Financial Times skewers the US decision to name China a currency manipulator.
Making the designation now is logically incomprehensible, has no or negative practical value and merely serves to underline the US's inability to force China to do what it wants.
The main reason is that there are no practical consequences of the designation. The first step is that it requires negotiations at the IMF.
The Treasury's stated reason for the designation on Monday was implicitly that China ought to have been intervening more rather than less. In other words, "manipulation" now simply means failing to keep the exchange rate at a level the US Treasury secretary of the day deems appropriate.
Beattie argues that if the US genuinely wanted a stable yuan then hitting China with tariffs and threats was the worst-possible course of action because that naturally puts downward pressure on the currency.
Read it here.
