US administration gets egg on its face with fallacious currency claim

The labeling of China as a currency manipulator on Monday by US Treasury Secretary Steven Mnuchin is another sign of the impulsive nature of the US administration's decision-making that is often based on its twisting of facts.

In May, the Treasury's semi-annual report to the US Congress determined that China is not a currency manipulator. The International Monetary Fund said at the time that China's handling of its currency was "broadly in line" with the state of its economy. A few months ago outgoing IMF managing director Christine Lagarde had dismissed the idea that China is manipulating its currency to gain a competitive advantage.

China's central bank has been letting market forces play a larger role in determining the yuan's exchange rate, and on Monday, when the yuan faced growing devaluation pressure under the latest US threat to impose 10 percent punitive tariff on $300 billion Chinese goods starting Sept 1, it went beyond 7 to the US dollar.