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China: Yuan Currency Not to Blame for US-China Trade Gap

China's Foreign Ministry says its currency policy is not to blame for the U.S. trade gap with China, rejecting renewed pressure by the United States to let its currency rise in value.

Spokesman Qin Gan said Monday China's exchange rate is not the main cause of the imbalance in trade between the countries and that the issue should not be politicized.

He said the Beijing government would take into account global and domestic performance when deciding how to reform its exchange rates. Qin's comments were in response to a question about a proposed U.S. law that would raise import duties and tariffs on China as punishment for Beijing's refusal to raise the value of the yuan.

Beijing has repeated on many occasions its view that excessive consumption in developed countries, and not China's currency policy, is the main cause of global economic imbalances.

The proposed U.S. trade law is not limited to China, but targets any country with an exchange rate the U.S. determines to be misaligned with the dollar. U.S. senators say they will introduce the law for debate by the end of the month.

Many economists estimate China's yuan currency is up to 40 percent undervalued against the dollar.

Some information for this report was provided by Reuters and Bloomberg.