The Obama administration has again criticized China for significantly undervaluing its currency, but stopped short of labeling Beijing a currency manipulator.
In its twice-yearly report to Congress on Wednesday, the United States Treasury acknowledged the value of China's currency, the renminbi, is rising, "but not as fast or by as much as is needed."
Responding to the report, Chinese foreign ministry spokeswoman Hua Chunying on Thursday said Beijing had made progress on currency issues. She called for the U.S. to not disrupt trade relations between the world's two largest economies.
"In principle, the ratio of China's current account to GDP is declining. There is no sign of depreciation. China's policy on its exchange rate has not changed. We hope relevant countries will work with China to ensure the sound and steady growth of trade relations," said Chunying.
Washington has long accused Beijing of keeping the value of its currency artificially low, giving Chinese companies an unfair advantage over U.S. manufacturers. A lower Chinese currency makes Chinese goods cheaper in the U.S. and American goods in China more expensive.
The Treasury report called the RMB "significantly undervalued." It suggested China was keeping its currency from strengthening by resuming its policy of government intervention, specifically, the "large scale purchases of foreign exchanges this year."
However, the report did not label China a currency manipulator, a designation that could eventually lead to trade sanctions and would prompt an angry reaction from Beijing. It said the U.S. will continue to monitor the pace of RMB appreciation and press for further policy changes.
President Barack Obama has argued that China is more likely to make economic reforms if the U.S. takes a less adversarial approach. The last time the U.S. labeled China a currency manipulator was in 1994, under then-President Bill Clinton.