U.S. Treasury Secretary Steven Mnuchin said China’s recent use of foreign currency reserves to prop up the yuan works to the benefit of American workers, and reverses years of intervention that made the country’s products cheaper to sell abroad.
“China has used their currency reserves to go the other direction, which is actually good for American workers,” Mnuchin told the Senate Banking Committee on Thursday, citing the findings of the Trump administration’s first Treasury report of foreign currency practices in April.
Mnuchin was responding to a question about why President Donald Trump last month backed down from a campaign promise to label China a currency manipulator.
Mnuchin said the findings of the semi-annual report showed that China had ended its decade-long foreign-exchange intervention practices that would warrant labeling the country a currency manipulator. China remains on a watch list.
“We will continue to monitor this behavior very carefully,” Mnuchin said.