Geithner Statement on Delay of Report on China Currency Policies
The following is a statement from Reserves Secretary Timothy Geithner on the choice to delay the Report to Congress on International Economic and Exchange Rate Policies that would deal with China’s yuan plot.
I have chose to delay publication of the report to Congress on the international economic and exchange rate policies of our major trading partners due on April 15. There are a run of very vital high-level meetings over the next three months that will be critical to bringing about policies that will help make a stronger, more sustainable, and more balanced global economy. Those meetings include a G-20 Finance Ministers and Central Bank Governors meeting in Washington later this month, the Strategic and Economic Dialogue (S&ED) with China in May, and the G-20 Finance Ministers and Leaders meetings in June. I believe these meetings are the best opportunity for advancing U.S. interests at this time.
As part of the overall effort to rebalance global demand and sustain progression at a high level, plot adjustments are needed that measurably strengthen domestic demand in some countries and boost saving in others. These are also vital to ensure robust job progression. In the United States, private savings has augmented, the current tab deficit has fallen, and the President has outlined a run of measures to reduce our monetary deficit.
Countries with large external surpluses and floating exchange rates, such as Germany and Japan, face the challenge of encouraging more robust progression of domestic demand. Surplus economies with inflexible exchange rates should say to high and sustained global progression and rebalancing by combining plot efforts to strengthen domestic demand with greater exchange rate flexibility.
This is especially right in China. China’s strong monetary and monetary response to the crisis enabled it to achieve economic progression of nearly 9 percent in 2009, contributing to global recovery. Now, but, China?s continued maintenance of a currency peg has required increasingly large volumes of currency intervention. Additionally, China’s inflexible exchange rate has made it hard for other emerging market economies to let their currencies appreciate. A go by China to a more market-oriented exchange rate will make an essential contribution to global rebalancing.
Our objective is to use the opportunity presented by the G-20 and S&ED meetings with China to make material progress in the coming months.