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By Caroline Grady 30-07-2020
In: hive-exclusives | Economics Emerging Markets FX

Taiwan, Thailand and Vietnam All Risk ‘Currency Manipulator’ Label

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The forthcoming US Treasury FX manipulation report will probably add several Asian countries to its watchlist. It may even go so far as to label some of them ‘currency manipulators’. Vietnam, Taiwan and Thailand are the three Asian countries at risk (and in Europe, Switzerland) which could prompt some increased disclosure, at least qualitatively, over currency intervention. It is unlikely, however, to alter efforts to lean against future currency appreciation in any of the three countries.

Treasury criteria, both economic and political
The US Treasury could release their delayed semi-annual FX manipulation report in the coming weeks. January’s report, delayed from the usual October release, was significant because it dropped the currency manipulator designation for China imposed in August 2019. Given the report came just ahead of the signing of the Phase 1 trade deal (and the renminbi was trading at its strongest level in around 5 months), the political element was very evident. Moreover, the currency manipulator label was announced in August 2019 despite China meeting only one of the three criteria in the May 2019 report.


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