WASHINGTON – The global economy remains “resilient,” according to Treasury’s newest “Report to Congress on Macroeconomic and Foreign Exchange Policies of Major Trading Partners of the United States.”
In the report, Treasury said it reviewed and assessed the policies of major U.S. trading partners, comprising about 78% of U.S. foreign trade in goods and services, during the four quarters through June 2023.
“The global economy continues to be more resilient than many predicted one year ago,” said Secretary of the Treasury Janet L. Yellen. “Nevertheless, the global economic outlook continues to face elevated uncertainty associated with Russia’s war against Ukraine, geopolitical stresses in the Middle East, still-elevated core inflation, and the potential for stresses in China’s property sector to deepen. Most foreign exchange intervention by U.S. trading partners over the Report period was in the form of selling dollars, actions that served to strengthen their currencies.
“However, Treasury remains vigilant to countries’ currency practices and the Biden Administration strongly opposes attempts by the United States’ trading partners to artificially manipulate currency values to gain unfair advantage over American workers.”
No Exchange Rate Manipulation Found
In accordance with the Omnibus Trade and Competitiveness Act of 1988, the report analyzed the practices of the United States’ major trading partners and concludes that no major U.S. trading partner manipulated the rate of exchange between its currency and the U.S. dollar for purposes of preventing effective balance of payments adjustments or gaining unfair competitive advantage in international trade during the four quarters through June 2023, Treasury said.
In this report, Treasury found that no major trading partner met all three criteria for enhanced analysis under the Trade Facilitation and Trade Enforcement Act of 2015 during the four quarters ending June 2023, Treasury said.
Six economies are on Treasury’s “Monitoring List” of major trading partners that merit close attention to their currency practices and macroeconomic policies: China, Germany, Malaysia, Singapore, Taiwan, and Vietnam.
Call for Increased Transparency
The report also reiterated Treasury’s call for increased transparency from China.
“China’s failure to publish foreign exchange intervention and broader lack of transparency around key features of its exchange rate mechanism make China an outlier among major economies and warrant Treasury’s close monitoring,” Treasury said.
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