A group of 14 US senators unveiled legislation on Tuesday that seeks to increase pressure on China to let its currency rise in value against the dollar, saying Chinese “currency manipulation” is hurting the US economy.
The bill calls for trade sanctions if China does not act. Treasury Secretary Timothy Geithner said the legislation is a sign of how strongly China’s trading partners feel about the issue. In an interview on Fox Business Network, Geithner said he believes Chinese officials “ultimately will decide it is in their interests to move”.
Geithner declined to respond directly to a question of whether the Obama administration would support the bill.
“We are sending a message to the Chinese government,” Democrat Senator Charles Schumer said in a statement. “If you refuse to play by the same rules as everyone else, we will force you to.” He said the issue is of critical importance at a time of high unemployment in the US. “There is no bigger step we can take to promote US job creation, particularly in the manufacturing sector,” Schumer said.
The Obama administration is hoping China will allow its currency to rise in value against the dollar as a way of narrowing that gap.