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Paulson treads carefully in Chinese currency dispute |
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Written by Staff Writer
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Jun 14, 2007 at 01:46 PM |
US Treasury Secretary Henry Paulson yesterdat resisted pressure from congress to label China a manipulator of currency markets.
Instead, he chose his words carefully. The yuan "is undervalued and market sentiment clearly favours appreciation" he said in the treasuries semi-annual review of currency policies in Washington.
The treasury stated that China failed to meet the technical definition of a currency manipulator because the US could not determine the intent to seek a trade advantage.
In response China has urged the US Congress to back away from the planned bill that coud lead to tarrifs on its exports, and pledging further reforms to strengthen the yuan.
"China has adopted a managed floating RMB (yuan) exchange rate regime and we have already begun reforms of the RMB exchange regime. The reform is ongoing.
We hope that US side can recognise this in an objective manner."
China Premier Wen Jiabao also pledged that monetary policies would be "moderately tightened".
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