President Trump Refuses To Call China A 'Currency Manipulator,' Breaking Campaign Promise

WASHINGTON, DC — The Trump administration will not label China a currency manipulator, according to an interview with President Trump in the Wall Street Journal, despite his promise to do so during the 2016 campaign. The president confirmed this decision in a press conference Wednesday afternoon.

Trump said repeatedly during the campaign that China manipulated its currency and put the United States at an unfair disadvantage. He pledged to direct his Treasury department to label the country a currency manipulator, which "should have been done years ago." (For more information on this and other political stories, subscribe to the White House Patch for daily newsletters and breaking news alerts.)

When President Obama's administration declined to assign the label to China in October, the Trump campaign criticized its choice to Politico:

“Obama’s Treasury Department had one last chance to fulfill candidate Obama’s [promise] to brand China a currency manipulator,” Trump campaign adviser Peter Navarro said in an email. “It refused, and Obama will leave office with one of his biggest lies intact. Now comes Hillary Clinton spinning the same yarns in states like Ohio, Pennsylvania and North Carolina that have been devastated by NAFTA and China and its voters beware.”

But now, after meeting with Chinese President Xi Jinping over the weekend, Trump has officially reversed course. “They’re not currency manipulators,” Trump told the Journal.

For what it's worth, many observers think Trump's new stance is the right one. Noah Smith, a columnist on economics and finance, said that though the country may have engaged in problematic currency manipulation in the past, it's much less of an issue now.

"The yuan is no longer undervalued," Smith wrote. "As China's economy slows and its asset markets look shaky, capital is flowing out of the country. That pushes the value of the yuan down. China still manipulates its currency, but it's now probably propping it up rather than holding it down. If China ends its manipulation, the yuan will probably get even cheaper, making its goods even cheaper in the U.S."

The White House also released a mysterious readout Wednesday on a call between Trump and Xi. "President Donald J. Trump spoke last night with President Xi Jinping of China to follow up after President Xi’s visit to Mar-a-Lago," it said. "It was a very productive call."

Senate Minority Leader Chuck Schumer, on the other hand, criticized Trump's about-face. "Unfortunately the President's failure to name China a currency manipulator is symptomatic of a lack of real, tough action on trade against China," he said in a statement. "China steals our intellectual property, doesn't let American companies compete in China, and has manipulated their currency causing the loss of millions of jobs. While they're not manipulating their currency at the moment because it doesn't suit their economic needs, make no mistake about it, as soon as the tide turns they will."

Trump says he wants to work with China to crack down on North Korea's militaristic ambitions, and softening his rhetoric on trade with the country may be a part of his strategy on this front.

But Schumer argued that this was mistake: "The best way to get China to cooperate with North Korea, is to be tough on them with trade, which is the number one thing China's government cares about."

Like the White House Patch Facebook Page.

Follow us on Twitter.

Sign up to comment on the site.

Photo by Joe Raedle/Getty Images News/Getty Images