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The People's Bank of China's Statement on the US T
Published:8/7/2019 4:20:40 PMViews: 130
Today, the People's Bank of China issued a statement about the US Treasury Department listing China as a "currency manipulator". The statement is as follows:
On August 6, Beijing time, the US Treasury Department listed China as a "currency manipulator", which China deeply regrets. This label does not conform to the so-called "exchange rate manipulator" quantitative standard formulated by the U.S. Treasury. It is a wayward unilateralism and protectionist act, which seriously undermines international rules and will have a significant impact on the global economy and finance.
China implements a managed floating exchange rate system based on market supply and demand, which is adjusted with reference to a basket of currencies. In terms of mechanism, the exchange rate of RMB is determined by market supply and demand, and there is no problem of "exchange rate manipulation". Since August this year, the RMB exchange rate has depreciated considerably, mainly reflecting market supply and demand and fluctuation of international exchange market under the background of changes in the global economic situation and intensified trade frictions, which are driven and decided by market forces. The People's Bank of China has been committed to maintaining the basic stability of the RMB exchange rate at a reasonable and balanced level, which is well known in the international community. According to the data released by the Bank for International Settlements, from early 2005 to June 2019, the nominal effective exchange rate of RMB appreciated by 38%, while the real effective exchange rate appreciated by 47%. It is the strongest currency in the G-20 economies and one of the largest currencies in the world. In the recently concluded International Monetary Fund (IMF) negotiations on Article 4 of China, the IMF pointed out that the exchange rate of the RMB is generally in line with the fundamentals. During the Asian financial crisis in 1997 and the global financial crisis in 2008, China has been committed to maintaining the stability of the RMB exchange rate, which has strongly supported the stability of the international financial market and the global economic recovery. Since 2018, the United States has been escalating trade disputes. China has always insisted on not engaging in competitive devaluation. China has not and will not use exchange rate as a tool to deal with trade disputes.
Regardless of the facts, the US unreasonably labels China as a "currency manipulator", which is both harmful and self-destructive. China firmly opposes this. This will not only seriously undermine the international financial order and cause financial market turbulence, but also greatly hinder international trade and global economic recovery, which will ultimately bear its own fruit. This unilateralism of the United States has also undermined the global multilateral consensus on exchange rate issues, which will have a serious negative impact on the stable operation of the international monetary system. China advises the US side to pull back from the cliff and get lost and return to the right track of rationality and objectivity.
China will continue to adhere to a managed floating exchange rate system based on market supply and demand, with reference to a basket of currencies, and maintain the basic stability of the RMB exchange rate at a reasonable and balanced level.