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China has not manipulated its currency



WASHINGTON (AP) – The International Monetary Fund sees little evidence that China's central bank has deliberately reduced the value of the nation's currency – a position that contradicts the Trump administration's decision this week to accuse Beijing of manipulating the yuan. [19659002] The IMF said Friday in its annual review of China's economy that the yuan has been "largely stable" against other currencies, suggesting that there has been little intervention from the People's Bank of China. A weaker yuan would give Chinese exporters a competitive price advantage over foreign rivals.

On Monday, the Department of Taxation appointed China a currency manipulator for the first time since 1

994. The move, and reversed its decision in May to keep China off the blacklist, came after Beijing's central bank let the yuan fall to its lowest point in 11 years.

"Obviously they are manipulating their currency," White House trade adviser Peter Navarro told CNBC Friday.

China's central bank sets the exchange rate every morning, allowing the yuan to fluctuate by 2% against the dollar during the day. The central bank can buy or sell currency – or order commercial banks to do so – to prevent the yuan's price from swinging too far.

As he let the yuan slip, the central bank reacted to the economic reality. China's economy is declining – in part because President Donald Trump has dropped its $ 250 billion Chinese import tariff – and market pressure is dragging the currency down.

The world's two largest economies are locked in a customs war over US claims that China is stealing trade secrets and forcing foreign companies to hand over sensitive technology. Twelve rounds of talks have failed to stop the curse, and a Chinese delegation is expected in Washington next month to continue negotiations.

But Trump rattled the financial markets on Friday by saying it would be "okay" with him if the talks ended. . The Dow Jones industrial average fell 90.75, or 0.3%, to 26,287.44, and the Nasdaq fell 80.02, or 1%, to 7,959.14.


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