WASHINGTON, June 21 ― The US Treasury yesterday said no major trading partner appeared to manipulate its currency last year, but it added Japan to a foreign exchange “monitoring list,” alongside China, Vietnam, Taiwan, Malaysia, Singapore and Germany, which were on the previous list.
Singapore met the criteria for engaging in persistent foreign exchange intervention and a material current account surplus and Malaysia only met the current account surplus criteria, but once on the list, it takes two currency report cycles to be dropped off. The official said the Bank of Japan's recent foreign exchange interventions to prop up the value of the yen were not a factor in deciding to add Japan to the currency monitoring list. The official cited Japan's high 2023 trade surplus of US$62.4 billion with the US and its global current account surplus of 3.5 per cent of GDP, up from 1.8 per cent in 2022.
The report said most foreign exchange interventions in 2023 focused on selling dollars -- actions that strengthen a currency's value against the dollar. The dollar has strengthened over the past two years as the Fed has raised interest rates sharply to cool inflation.