The US Senate Finance Committee voted 20-1 on Thursday to give the government
new tools to pressure countries to adopt more market-oriented currency
The legislation would allow U.S. companies to seek anti-dumping duties on
goods from any country that maintains a "fundamentally misaligned" exchange rate
after being formally cited by the United States.
"Today's China's renminbi is the focus of our concerns. Tomorrow another
economy's currency may threaten even more devastating effects," Senate Finance
Committee Chairman Max Baucus, a Montana Democrat, said.
The bill also would require the Bush administration to take action through
the International Monetary Fund and the World Trade Organization against
targeted countries that refuse to reform their currency policies.
Another provision would allow the Federal Reserve to intervene in global
markets against the misaligned currency if the country has not made appropriate
reforms one year after being cited by the United States.
The vote came just a few days before U.S. Treasury Secretary Henry Paulson
heads to China to press for faster action on currency reform.
Although Beijing has taken some steps toward a market-based exchange rate,
many U.S. manufacturers believe the yuan is still undervalued by 25 to 40