Washington: US President Donald Trump on Monday accused China of manipulating its currency by dropping the price of Yuan.
“China dropped the price of their currency to an almost historic low,” Trump said in a tweet. “It’s called ‘currency manipulation.’ Are you listening to Federal Reserve? This is a major violation which will greatly weaken China overtime!”
China, which controls its own currency unlike other countries, allowed the Yuan to fall to its lowest level in more than a decade. The Yuan traded above 7 per US dollar. The move will make Chinese products cheaper.
The move came days after Trump announced new tariffs Thursday on USD 300 billion on Chinese goods.
“Influenced by unilateralism, trade protectionism and tariff expectations imposed on China, the renminbi has depreciated against the US dollar today, breaking through 7,” Washington Post quoted China’s central bank said in a statement on its website.
The bank said it was confident it could keep the currency at a “reasonable and balanced level.”
The new sanction would mean everything that China sells to the US, including clothes and iPhones to chemicals and construction equipment, will have levies of between 10 and 25 per cent on them starting September.
Trump accuses China of stealing intellectual property, forcing foreign companies to hand over their technology as price of market entry, and subsidising state-owned enterprises to give them competitive advantages.