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The US adds India, Thailand and Taiwan to currency manipulation watchlist
The US on Wednesday added India along with Taiwan and Thailand to the "monitoring list" of currency manipulating countries that includes major trading partners like China and six others
The US on Wednesday added India along with Taiwan and Thailand to the "monitoring list" of currency manipulating countries that includes major trading partners like China and six others.
It also branded Vietnam and Switzerland as currency manipulators.
Over the four quarters through June 2020, four major US trading partners Vietnam, Switzerland, India, and Singapore intervened in the foreign exchange market in a sustained, asymmetric manner, it said.
Vietnam and Switzerland exceeded the two other objective criteria established by the Treasury to identify potentially unfair currency practices or excessive external imbalances, which could weigh on US growth or harm American workers and firms.
The Treasury found that 10 economies warrant placement on Treasury's "Monitoring List" of major trading partners that merit close attention to their currency practices: China, Japan, Korea, Germany, Italy, Singapore, Malaysia, Taiwan, Thailand, and India, the last three being added in the report.
Based on Reserve Bank of India's regularly published intervention data, India's net purchases of foreign exchange accelerated notably in the second half of 2019, and following sales during the initial onset of the pandemic, India sustained net purchases for much of the first half of 2020, the report said.
This pushed net purchases of foreign exchange to USD 64 billion, or 2.4 per cent of GDP, over the four quarters through June 2020.
"Treasury continues to welcome India's long-standing transparency in publishing foreign exchange purchases and sales, the report said, adding that it encourages the authorities to limit foreign exchange intervention to periods of excessive volatility, while allowing the rupee to adjust based on economic fundamentals.
"By further opening the economy to foreign investors, India can also support economic recovery and bolster long-term growth, said the report. (PTI)