The Glossary
Currency Manipulation
The Treasury label applied to China in August 2019 — for five months.
Definition
When the renminbi crossed 7 to the dollar on August 5, 2019, the Treasury designated China a currency manipulator under statutory criteria — the first such designation since 1994. The label carried consultation requirements rather than sanctions, and was lifted in January 2020 as the Phase One deal approached. Economists largely judged the RMB move market-driven amid tariff escalation; the episode illustrates how currency politics track the trade cycle.
Why it matters
Currency offset is a standing escalation option: if tariffs push currencies to offset them, tariff-setters respond — a feedback loop markets watch in every round.