BOOM

Trending Searches

    SUPPORT
    BOOM

    Trending News

      • Fact Check 
        • Fast Check
        • Politics
        • Business
        • Entertainment
        • Social
        • Sports
        • World
      • Law
      • Explainers
      • News 
        • All News
      • Decode 
        • Impact
        • Scamcheck
        • Life
        • Voices
      • Media Buddhi 
        • Digital Buddhi
        • Senior Citizens
        • Videos
      • Web Stories
      • BOOM Research
      • BOOM Labs
      • Deepfake Tracker
      • Videos 
        • Facts Neeti
      • Home-icon
        Home
      • About Us-icon
        About Us
      • Authors-icon
        Authors
      • Team-icon
        Team
      • Careers-icon
        Careers
      • Internship-icon
        Internship
      • Contact Us-icon
        Contact Us
      • Methodology-icon
        Methodology
      • Correction Policy-icon
        Correction Policy
      • Non-Partnership Policy-icon
        Non-Partnership Policy
      • Cookie Policy-icon
        Cookie Policy
      • Grievance Redressal-icon
        Grievance Redressal
      • Republishing Guidelines-icon
        Republishing Guidelines
      • Fact Check-icon
        Fact Check
        Fast Check
        Politics
        Business
        Entertainment
        Social
        Sports
        World
      • Law-icon
        Law
      • Explainers-icon
        Explainers
      • News-icon
        News
        All News
      • Decode-icon
        Decode
        Impact
        Scamcheck
        Life
        Voices
      • Media Buddhi-icon
        Media Buddhi
        Digital Buddhi
        Senior Citizens
        Videos
      • Web Stories-icon
        Web Stories
      • BOOM Research-icon
        BOOM Research
      • BOOM Labs-icon
        BOOM Labs
      • Deepfake Tracker-icon
        Deepfake Tracker
      • Videos-icon
        Videos
        Facts Neeti
      Trending Tags
      TRENDING
      • #Operation Sindoor
      • #Pahalgam Terror Attack
      • #Narendra Modi
      • #Rahul Gandhi
      • #Waqf Amendment Bill
      • #Arvind Kejriwal
      • #Deepfake
      • #Artificial Intelligence
      • Home
      • World
      • Explained: India Added To US...
      World

      Explained: India Added To US Currency Manipulation Watchlist

      The Department of Treasury has put India on currency manipulation watchlist in its semi-annual report to Congress.

      By - Mohammed Kudrati |
      Published -  17 Dec 2020 9:21 PM IST
    • Boomlive
      Explained: India Added To US Currency Manipulation Watchlist

      India has been included on a currency manipulation watchlist by the United States government. In its semi-annual report to the US Congress, the Department of Treasury included India and nine other countries on its watchlist monitoring currency practices and macroeconomic policies.

      This falls just below the designation of 'currency manipulators', which the US government has given Switzerland and Vietnam in its report.

      However, the Treasury welcomed transparency in how India reports its data, with the report appreciating India's transparency in how it published its intervention data in foreign exchange, which showed it purchasing excessive foreign reserves worth $64 billion, or 2.4% of gross domestic product (GDP) in the four quarters ending June 2020. Data from MarketWatch shows the Indian rupee depreciating 3.1% year-to-date.

      Further, the Treasury encouraged India to limit foreign exchange intervention to periods of volatility, and to let the rupee adjust according to prevailing economics. It also encouraged India to open the economy more to foreign investors to support recovery post the pandemic economic hit and to fortify long-term growth.

      India, Thailand and Taiwan have been added on this edition of the report. It joins China, Japan, Korea, Germany, Italy, Singapore and Malaysia on the watchlist. Ireland has been removed from the watchlist in this edition of the report.

      Currency manipulation is a practice by which countries deliberately controls the exchange value of their currency instead of letting them be determined by economic forces, to give them an advantage in international trade or policy. For example, through policies like these, countries could keep their currency weaker than it should be, therefore encouraging exports by making them more attractive abroad, and discouraging imports by making them less affordable at home. The practice often become an issue of international economic diplomacy, as it has a cascading effect businesses and workers due to unfair trade.

      Also Read: Electoral College Formally Elects Joe Biden As US President

      From the US' perspective, the Treasury outlines these currency practices as, "[to] consider whether countries manipulate the rate of exchange between their currency and the United States dollar for purposes of preventing effective balance of payments adjustments or gaining unfair competitive advantage in international trade."

      US President Donald Trump has often riled against China and European economies for keeping their currency low and hurting the US economy.


      China and Europe playing big currency manipulation game and pumping money into their system in order to compete with USA. We should MATCH, or continue being the dummies who sit back and politely watch as other countries continue to play their games - as they have for many years!

      — Donald J. Trump (@realDonaldTrump) July 3, 2019


      How are currency manipulators decided?

      The Treasures lists three criteria for currency manipulation. To be added on the watchlist, a country would have to fulfill any two of the three. After being on the watchlist, the countries are kept there for two subsequent to take steps to rectify any practices that they may have in that regard.

      Switzerland and Vietnam, labelled currency manipulators in this report, fulfill all three criteria.

      The criteria outlined by the report are:

      1. A bilateral trade surplus (excluding services) with the US of over $20 billion over a 12 month period.
      2. A current account surplus of atleast 2% of GDP over a 12 month period
      3. A country carries out persistent unilateral interventions in foreign exchange markets in 6 out of the last 12 months. Further, these interventions need to be worth 2% of a country's GDP

      The Treasury justifies these criteria by saying, "Treasury's goal in establishing these thresholds is to identify where potentially unfair currency practices or excessive external imbalances that could weigh on U.S. growth or harm U.S. workers and businesses may be emerging."

      Read the Treasury's report here.

      Also Read: RBI's Inflation Targets May Be Loosened To Bolster Growth: Bloomberg

      Tags

      Currency ManipulationUS DollarIndian RupeeChinaTaiwanThailandVietnamSwitzerlandGermanyItalyIrelandUS TreasuryUS governmentUS CongressEuropeSingaporeMalaysiaInternational tradeInternational EconomyEconomics#Explained#DonaldTrump
      Read Full Article
      Next Story
      Our website is made possible by displaying online advertisements to our visitors.
      Please consider supporting us by disabling your ad blocker. Please reload after ad blocker is disabled.
      X

      Subscribe to BOOM Newsletters

      👉 No spam, no paywall — but verified insights.

      Please enter a Email Address
      Subscribe for free!

      Stay Ahead of Misinformation!

      Please enter a Email Address
      Subscribe Now🛡️ 100% Privacy Protected | No Spam, Just Facts
      By subscribing, you agree with the Terms & conditions and Privacy Policy connected to the offer

      Thank you for subscribing!

      You’re now part of the BOOM community.

      Or, Subscribe to receive latest news via email
      Subscribed Successfully...
      Copy HTMLHTML is copied!
      There's no data to copy!