Statement Of The People's Bank Of China On The US Treasury's Listing China As A Currency Manipulator

In August 6th, the United States Treasury Department listed China as a "currency manipulator" in the Beijing time. China deeply regrets this. This label does not conform to the quantitative standard of the so-called "currency manipulation state" formulated by the US Treasury itself. It is a willful unilateralism and protectionism, which seriously undermines international rules and will have a significant impact on global economic and financial affairs.


China has implemented a regulated floating exchange rate system based on market supply and demand and reference to a basket of currencies. In terms of mechanism, the RMB exchange rate is determined by market supply and demand, and there is no "exchange rate manipulation" problem. Since August this year, the depreciation of the RMB exchange rate has been mainly driven by the changes in the global economic situation and the intensification of trade frictions. The people's Bank of China has always been committed to maintaining a basically stable RMB exchange rate at a reasonable and balanced level. This effort is well known in the international community. According to the data released by the bank for International Settlements, from the beginning of 2005 to June 2019, the nominal effective exchange rate of RMB appreciated by 38%, and the real effective exchange rate appreciated by 47%. It is the most powerful currency in the twenty group economy, and it is also one of the currencies with the largest appreciation in the world. In the consultations on the fourth terms of the IMF just concluded, the IMF pointed out that the RMB exchange rate basically met the fundamentals. In the 1997 Asian financial crisis and the 2008 global financial crisis, China has been committed to maintaining a stable RMB exchange rate and strongly supporting the stability of the international financial market and the global economic recovery. Since 2018, the United States has been upgrading trade disputes. China has always insisted on not doing competitive devaluation. China has not and will not use the exchange rate as a tool to deal with trade disputes.


The Chinese side firmly opposes the fact that the United States ignores the fact that it is unreasonable to label China as a currency manipulator country. This will not only seriously disrupt the international financial order, cause financial market turbulence, but also will greatly impede international trade and global economic recovery, and will eventually bear fruit. The unilateralism of the United States has also destroyed the global consensus on the exchange rate issue and will have a serious negative impact on the stable operation of the international monetary system. The Chinese side advised the US side to rein in the precipice and return to the correct and objective track.


China will continue to adhere to a regulated and managed floating exchange rate system based on market supply and demand and reference to a basket of currencies, so as to maintain the basic stability of the RMB exchange rate at a reasonable and balanced level.