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US Treasury To Accuse Vietnam Of Manipulating Its Dong

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US Treasury To Accuse Vietnam Of Manipulating Its Dong

Profile picture for user Tyler Durden
Thu, 05/09/2019 - 17:27

Call it twofold projection by the US Treasury.

Bloomberg reports that the Trump administration will expand the number of countries it scrutinizes for currency manipulation in an upcoming report, citing "people familiar with the matter."  Yet even after lowering the bar for foreign governments to come under scrutiny, such usual suspects as China, Japan, Switzerland, and Korea will escape scrutiny, and instead Steven Mnuchin's treasury will project the US government's impotence in calling a spade a spade, and will accuse a lightweight of manipulating its currency instead.

According to the report, so far the Treasury has examined its 12 largest trade partners and Switzerland. An expanded watch list could include Russia, Thailand, Indonesia, Vietnam, Ireland or Malaysia, all of which have large trade surpluses with the U.S.

Perhaps in order to provide comedic relief, Bloomberg reports that Vietnam may be named a manipulator outright for artificially holding down its currency - which as Zero Hedge readers know well - is called the dong, as it met all three criteria the Treasury Department uses to test for currency interventions (in a world in which every central bank manipulates its currency, these criteria are likely not being named China, Japan, which is buying almost every single Japanese ETF it can find to crush the yen, or Switzerland, which is aggressively buying Apple stock to continue to devalue the franc).

 

 

vnd-500k-front.jpg

Internal debate is continuing over the issue and the administration has asked Vietnam to disclose more information before it releases the report.

While we do not know what specific criteria is used, we do note that the Dong has been materially limp relative to the excited surge in positivity that has seen Vietnam's CDS spread collapse.

 

bfmD371.jpg

Of course, since this is all projection in every sense of the word, the label has no practical effect, other than requiring the U.S. to engage in negotiations with offending countries, but is likely to have market repercussions for any government named a manipulator. Although, since their goal is to weaken the currency, this may just make their lives easier.

The U.S. has not labeled a major trade partner a currency manipulator since 1994.

 

https://www.zerohedge.com/news/2019-05-09/us-treasury-expands-currency-probe-may-name-vietnam-dong-manipulator

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More on US Treasury Department may label Vietnam a currency manipulator

 Thu 9 May 2019 21:27:50 GMT
Author: Eamonn Sheridan | Category:  News

 

 

Earlier post is here: US says it will examine more countries for currency manipulation

Bloomberg have more, citing 'people familiar with the matter': 
  • Trump administration will expand the number of countries it scrutinizes for currency manipulation in an upcoming report
  • lowering the bar for foreign governments to come under scrutiny
The 'people familiar say that Treasury has reduced one of the three criteria it uses to test for manipulations
  • the current account surplus, which captures the difference between the amount a country exports and imports. The criteria was reduced to a surplus of 2 percent of gross domestic product from 3 percent
The list of suspects to include about 20 countries, from 12 in the previous report 
  • Vietnam may be named a manipulator outright for artificially holding down the value of the dong, the people said, after meeting all three criteria the Treasury Department uses to test for currency interventions. 
  • Internal debate is continuing over the issue and the administration has asked Vietnam to disclose more information before it releases the report.
Vietnam dong bank note
As some background to this:
  • The US Treasury issues its foreign currency report a report twice a year.
  • The next is expected this month.
There are 3 criteria, one is referred to above, the other two:
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10 minutes ago, md11fr8dawg said:

BA, none of my business, but are you holding and Dong?

 

No... One crazy currency is enough for me and if this Dinar ever hits I'm done...

 

B/A

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1 hour ago, bostonangler said:

 

No... One crazy currency is enough for me and if this Dinar ever hits I'm done...

 

B/A

 

Double your pleasure, double your fun!!!

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Thank God, it’s “about time.”  This Trump administration is globally amazing.  If anyone cannot see and agree to this, etc., they are both spiritually and politically blind.

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On 5/10/2019 at 6:19 AM, Indraman said:

I won't hold anybodies Dong...I am just not that kind of guy...😲

 

Indy

My new trainer at work is

Dong Do. Had a excoworker name was Long Dong. I told him he should be very popular here in the states.

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I hope this comes with a Happy Ending ...

:D:mexican:

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