US keeps China on currency watch list

WASHINGTON (AA): Amid an ongoing trade war between United States and China, Washington has removed India from its currency monitoring list while Beijing still remains on it.

The U.S. Treasury Department has, however, urged China to take necessary steps to avoid a “persistently weak currency”, U.S. Treasury said in a report on Tuesday.

Switzerland has also been removed from the list.

India, China, Japan, Germany, Switzerland and South Korea were placed in the bi-annual currency watch list in October last year.

Designation as a currency manipulator comes with no immediate penalties but can shake financial markets.

The details were revealed after U.S. Treasury submitted its semi-annual report to Congress on International Economic and Exchange Rate Policies.

“Treasury continues to urge China to take the necessary steps to avoid a persistently weak currency,” said U.S. Treasury Secretary Steven Mnuchin in a statement. Mnuchin noted that China’s trade surplus with the U.S. has also widened.

“China’s goods trade surplus with U.S. stands at $419 billion over the four quarters through December 2018,” the report said.

Besides, China, South Korea, Japan, Germany, Italy, Ireland, Singapore, Malaysia and Vietnam continue to remain in the U.S. currency watch list.

“Treasury found that nine major trading partners continue to warrant placement on Treasury’s ‘Monitoring List’ of major trading partners that merit close attention to their currency practices,” Mnuchin said. The Treasury report, however, has declined to “designate China or any other major trading partner as a currency manipulator”.