US Treasury Currency Report

This Report assesses developments in international economic and exchange rate policies over the four quarters through June 2025 (the official Report period) and more recent developments where data are available. The analysis in this Report is guided by Sections 3001-3006 of the Omnibus Trade and Competitiveness Act of 1988 (1988 Act) (codified at 22 U.S.C. §§ 5301-5306) and Sections 701 and 702 of the Trade Facilitation and Trade Enforcement Act of 2015 (2015 Act) (codified at 19 U.S.C. §§ 4421-4422), as discussed in Section 1 of this Report. Treasury reviews developments in the 20 largest trading partners of the United States over the period of review. These economies accounted for about 78% of U.S. trade in goods and services over the four quarters through June 2025. President Trump is committed to pursuing economic and trade policies that will spur an American revitalization marked by strong economic growth, the elimination of destructive trade deficits, and countering unfair trade practices. For decades, unfair currency practices abroad have contributed to the U.S. trade deficit and the hollowing out of U.S. manufacturing employment. When a trading partner engages excessively in foreign exchange market interventions or other actions to artificially lower the value or suppress appreciation of its currency, this distorts market-based competition, promoting domestic production and exports and suppressing imports in ways that do not reflect the productivity of economies or competitiveness of traded goods. Treasury is closely monitoring whether our trading partners may act through foreign exchange intervention and non-market policies and practices to manipulat *TREASURY SAYS YUAN 'SUBSTANTIALLY UNDERVALUED' *US CALLS ON CHINA TO ALLOW YUAN TO STRENGTHEN IN TIMELY MANNER

President Trump is committed to pursuing economic and trade policies that will spur an American revitalization marked by strong economic growth, the elimination of destructive trade deficits, and countering unfair trade practices. This includes combatting unfair currency practices that facilitate competitive advantage, such as unwarranted intervention in currency markets. In this Administration, the Secretary of the Treasury will be vigilant in identifying and taking action against currency manipulation. Treasury will also examine other macroeconomic and financial policies implemented by our trading partners that propagate imbalances or result in an unfair competitive advantage in trade. For decades, unfair currency practices abroad have contributed to the U.S. trade deficit and hollowed out U.S. manufacturing employment. When a trading partner engages excessively in foreign exchange market interventions or other actions to artificially lower the value or suppress appreciation of its currency, this distorts market-based competition, promoting domestic production and exports, and suppressing imports, in ways that do not reflect the productivity of economies or competitiveness of traded goods. There has been a decline in the scale and persistence of foreign exchange intervention among most major U.S. trading partners in recent years, but the damage done is long lasting, including through the reallocation of supply chains and their associated quality jobs, as well as the loss of the homeland’s ability to manufacture critical defense and industrial equipment. The economic and national security implications are self-evident. In very recent years the dollar has generally been strong relative to historical averages, and there have been less persistent appreciation pressures across other currencies. Treasury is closely monitoring whether our trading partners may act through foreign exchange intervention, or non-market policies and practices, to manipulate their currencies for unfair competitive advantage in trade and prevent the swift recovery of American economic strength. In this context, Treasury will continue to monitor closely the extent to which intervention by our trading partners is two-way, and whether economies that choose to smooth exchange rate movements resist depreciation pressure in the same manner as appreciation pressure. U.S. TREASURY SAYS SEMI-ANNUAL CURRENCY REPORT FOUND NO MAJOR U.S. TRADING PARTNERS MANIPULATED CURRENCY TO GAIN UNFAIR TRADE ADVANTAGE IN FOUR QUARTERS THROUGH DECEMBER 2024 U.S. TREASURY: MONITORING LIST OF TRADING PARTNERS WHOSE CURRENCY PRACTICES 'MERIT CLOSE ATTENTION' INCLUDES CHINA, JAPAN, SOUTH KOREA, SINGAPORE, TAIWAN, VIETNAM, GERMANY, IRELAND AND SWITZERLAND U.S. TREASURY: WHILE CHINA IS NOT LABELED A CURRENCY MANIPULATOR AMID YUAN DEPRECIATION PRESSURE, CHINA STANDS OUT AMONG TRADING PARTNERS FOR LACK OF TRANSPARENCY ON EXCHANGE RATE PRACTICES AND POLICIES

The global economy continues to show strength and is poised to make a soft landing. The IMF projects global growth of 3.3% in 2024 on a Q4 over Q4 basis, and high frequency measures of production and prevailing business conditions suggest global economic activity remains solid. As the world’s largest economy, America’s strong economic performance is serving as a key engine for resilient global growth. Global headline inflation has declined from a peak of 7.3% in September 2022 to 2.4% in July 2024. Declining inflation reflects lower food and energy prices, and generally lower goods prices as monetary tightening has eased price pressures. Most economies are on track to return inflation to central bank targets by next year. Labor markets across the world’s largest economies remain robust and, across the G20, unemployment rates remain at, or very close to, their lowest rate since the onset of the pandemic. The risks to the global economic outlook have become more balanced on net over the past year, though Russia’s war against Ukraine and the risk of wider conflict in the Middle East continue to be a risk to the outlook with the possibility of volatility among critical commodity prices and increased energy and food insecurity. Global current accoun US TREASURY: THE SEMI-ANNUAL CURRENCY REPORT FOUND NO MAJOR US TRADING PARTNERS MANIPULATED CURRENCY TO GAIN UNFAIR TRADE ADVANTAGE IN FOUR QUARTERS THROUGH JUNE 2024. US TREASURY: CHINA'S FAILURE TO PUBLISH FOREIGN EXCHANGE INTERVENTION DATA AND LACK OF EXCHANGE RATE POLICY TRANSPARENCY MAKE CHINA AN OUTLIER, AND WARRANTS CLOSE MONITORING.