Treasury Secretary Steve Mnuchin said Thursday that the Trump administration will wait until April before deciding if China should be considered a currency manipulator.
A decision over the move, which would pave the way for tariffs on Chinese imports, will come in a biannual report on foreign exchange markets, Mnuchin told Bloomberg.
The report could give President Trump an off-ramp to walk back one of his first campaign promises. Early during the Republican Primary, Trump said he would declare China a currency manipulator on his first day in office.
Between the election and his inauguration, however, in early January, he walked back the claim.
“I would talk to them first,” Trump said. “Certainly they are manipulators. But I’m not looking to do that.”
Days after Trump won the 2016 presidential election, a Chinese Communist Party-tied publication vowed that Beijing would retaliate with a view of leaving the US economy “paralyzed.”
“A batch of Boeing orders will be replaced by Airbus,” The Global Times stated. “US auto and iPhone sales in China will suffer a setback, and US soybean and [corn] imports will be halted.”
In recent weeks, Trump has softened his rhetoric on China, outside of his foreign exchange claims. He reversed tack and agreed to honor the “One China” policy in a Feb. 9 phone call with Chinese President Xi Jinping. The term refers to the decades-long US approach to Taiwan, which Beijing considers a “renegade province.”
As a candidate, President Obama had also accused China of manipulating its currency, but never tagged it with the manipulator distinction. China did, however, start to freely float its currency, the Yuan, in late 2010.
The Yuan hit a record high in 2014, but trended downwards afterwards, as financial crises rocked the Chinese economy.
A new poll released by Gallup on Thursday also revealed that Trump might not have as much political capital to move against China, as previously believed. A slim majority of Americans now see China as “favorable” for this first time since the 1989 Tiananmen Square Massacre.
The uptick in Americans with a more positive view of China includes conservatives. Gallup found that 38 percent of Republicans currently have a “favorable” view of China, up from 28 percent last year.
