Treasury Secretary Timothy Geithner said the U.S. favors a "gradual, but still significant" appreciation of the yuan.

Geithner said the U.S. would prefer China let market forces drive up the value of the currency, The Wall Street Journal said. Geithner noted that the yuan had strengthened by about 2.5% in six weeks.

"What we want to do is to maximize the incentives they have to let that process go as far as it needs to go," Geithner said. "I'm very confident over time that this is going to happen."

Such a policy is in Chinese interest, as a stronger currency would help stimulate domestic demand, the Treasury Secretary said.

"China, over time, wants to get better at producing things that create more value, generate more income for their people; and you can't do that if you're in effect favoring low-value-added assembly operations that aren't going to generate much income for your people," Geithner said.

Geithner said there was "no risk" of a currency war.



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frank1946

Debt is destroying America, our Fathers would be enraged by this formal statement from the US Treasury............raise the prices on our competitors goods and services, free markets ? What a sad commetary on the Federal Government. He should have said we will reduce the taxes on capital investment to Zero, no capital gain tax............make export type jobs attractive to employers again, spur new investment and output and jobs ! USA has the highest investment taxes in the World today, no wonder no jobs and investors go to other nations to make and produce.

October 14 2010 at 7:29 AM Report abuse rate up rate down Reply
geraldlsolis

Of course Geithner wants China to make their currency higher in comparison to the dollar. OK, so China do this to bail out the US from their wanton spending both domestically and abroad. Please China, save us from our own failures. This way the TRILLION dollars we owe China will be worth less. If they appreciate their currency by 5%, we get off the hook for our debt for $50 BILLION. Come on, China, shoot yourself in the foot and take a $50 BILLION hit for your friends in America. And, this will make our ridiculous monthly trade deficit of $50 BILLION look better to the voters back here. You know we'd do the same thing for you. But, oopps, sorry, we can't... we're broke.

October 13 2010 at 9:58 AM Report abuse +3 rate up rate down Reply