Comments from Chinese officials over the weekend suggested they’re trying to push back on US demand regarding currency manipulation. China PBoC Governor Yi Gang said over the weekend that both sides reached consensus of many important issues, including competitive devaluation of currencies. But he also emphasized that yuan exchange-rate formation mechanism is in line with G20 standard.
Yi went further to noted that US and China discussed respecting the “autonomy” of each other’s monetary policy. Vice Commerce Minister Wang Shouwen also said on Saturday that any “enforcement mechanism for a prospective trade deal must be “two way, fair and equal.” Apparently, Chinese officials were avoiding any mention of one-sided pledge on currency.
On the other hand, White House economic advisor Larry Kudlow said there was a breakthrough with China agreeing to promote “stable currency and avoid competitive devaluation. He’s “positive and bullish” on a US-China trade deal. And he expects the agreement to be finalized by April. He also hailed that Trump administration is making “headway” in the negotiations and is “making great progress”. Currently, Kudlow added that negotiators are “working out some of the difficult final points” And, “it’s got to be good, it’s got to be fair and reciprocal, and it has got to be enforceable — that’s an important point.”
