Summary:Chinaâs policy of intervening in currency markets to limit or halt the appreciation of its currency, the renminbi (RMB), against the U.S. dollar and other currencies has been an issue of concern for many in Congress over the past decade or so. Some Members charge that China âmanipulatesâ its currency in order to make its exports significantly less expensive, and its imports more expensive, than would occur if the RMB were a freely traded currency. Some argue that the RMB is significantly undervalued against the dollar and that this has been a major contributor to the large annual U.S. merchandise trade deficits with China (which was $343 billion in 2014) and the decline in U.S. manufacturing jobs. Legislation to address foreign currencies deemed to be undervalued has been introduced in every Congress since 2003. China has often been the main target of such legislation, although in recent years, the currency policies of other countries have also come under scrutiny. In the 114th Congress, H.R. 820, S. 433, and S. 1267 would seek to treat certain undervalued currencies as an actionable subsidy under U.S. countervailing laws. On August 11,, 2015, the Chinese central bank announced that daily RMB parity values would become more âmarket-oriented.â However, over the next three days, the RMB depreciated by 4.4% against the dollar, renewing concerns about Chinaâs currency policy.
