US Send First Salvo Over BOJ’s Shenanigans

The U.S. Treasury on Friday warned Japan not to actively weaken its currency as it again refrained from naming China a manipulator.

In its twice-a-year assessment of whether any nation is a currency manipulator, Treasury said it will “closely monitor” Japan’s policies and the extent to which they support the growth of domestic demand. The new Shinzo Abe administration has pushed for aggressive bond-buying at the Bank of Japan, and the yen has dropped 13% against the dollar this year. The Japanese currency rose in Friday afternoon trade after the report was released.

“We will continue to press Japan to adhere to the commitments agreed to in the G-7 and G-20, to remain oriented towards meeting respective domestic objectives using domestic instruments and to refrain from competitive devaluation and targeting its exchange rate for competitive purposes,” the Treasury said.

China meanwhile escaped being branded a currency manipulator by the U.S. government, due to an appreciation in the yuan and a drop in its current account surplus.

China hasn’t been named a manipulator since 1994. Both Obama and George W. Bush administrations have been loath to name China a manipulator because of fears of escalating trade tensions.


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Mingze Wu

Mingze Wu

Currency Analyst at Market Pulse
Based in Singapore, Mingze Wu focuses on trading strategies and technical and fundamental analysis of major currency pairs. He has extensive trading experience across different asset classes and is well-versed in global market fundamentals. In addition to contributing articles to MarketPulseFX, Mingze centers on forex and macro-economic trends impacting the Asia Pacific region.
Mingze Wu