China and the US traded barbs on Friday over the economy and human rights, raising the temperature ahead of a possible showdown over currency policy next month.
Financial Times, 12 March 2010
Su Ning, a deputy governor of the Chinese central bank, said the US should not “politicise” China’s currency policy, a day after Barack Obama, US president, urged China to adopt a “more market-oriented exchange rate”.
“We always refuse to politicise the yuan exchange rate issue and we never think that one country should ask another for help in solving its own problems,” Mr Su said on Friday.
Mr Obama’s comments on Thursday came ahead of a decision the US Treasury department must make by April 15 on whether to label China as a “currency manipulator”. Political pressure is beginning to mount again in the US for action against China if it does not abandon the peg to the US dollar it has held since mid-2008.
China had appeared to signal it was considering a shift in policy when the head of the central bank said last weekend that the currency peg was a “special” policy for the financial crisis and that it would be abandoned “sooner or later”.
Romano Prodi, former president of the European Commission, said the US and Europe were wrong to criticise China over its currency because this would be counter-productive.
