Executive Order Outlines Agency Responses to Currency Manipulation
President Barack Obama on July 22 issued an executive order directing the Treasury Department on how to coordinate interagency recommendations for the White House in cases that involve foreign currency manipulation or reduce significant trade surpluses with the U.S., as…
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determined through Treasury investigations (here). Customs reauthorization legislation signed into law earlier this year required Treasury to issue reports on the exchange rate practices of any major trading partner that has a significant bilateral trade surplus with the U.S., a material current account surplus and has repeatedly intervened in currency markets (see 1602240071). The legislation also requires the president to offset countries’ failures to adopt adequate policies to reverse currency manipulation and external surpluses within one year (see 1605020035). According to the executive order, if the Treasury secretary finds that a country hasn’t adopted policies to “correct the undervaluation and surpluses” pursuant to the customs law, the assistant to the president for economic policy, in consultation with the Treasury secretary, the U.S. Trade Representative, the secretary of State, and the Commerce secretary will advise the president on available courses of action or on whether the president should waive the requirement to take remedial action. The order also authorizes State, Treasury, Commerce and the Office of the USTR to delegate outlined functions.