BATON ROUGE, La. U.S. President-elect Donald Trump on Friday said that China and other countries often devalue their currencies as the U.S. economy improves, vowing to combat currency manipulation and the dumping of foreign products into U.S. markets below cost.
"We'll renegotiate our trade deals, stop the product dumping and the currency manipulation which is a disaster for our country," Trump said at a rally in Baton Rouge, Louisiana. "Every time we get going, China and others, they just knock the hell out of the value of their currency and we have to go back and back, and it just doesn't work, folks."
China's yuan hovered at a near 8-1/2-year low of about 6.9 to the dollar on Friday. China's central bank has been selling dollars to keep the yuan from falling further in response to capital outflows, reporting on Wednesday that its foreign exchange reserves fell by $69 billion in November - a fifth straight month of losses - to around $3.05 trillion.
A surge in the dollar and U.S. bond yields since Trump's election a month ago also has exacerbated the yuan's fall.
Trump, however, stopped short of repeating his campaign pledge to formally declare China a currency manipulator after he takes office on Jan. 20. Such a declaration by the U.S. Treasury Department would launch a series of demands for negotiations with Beijing to try to remedy the situation to improve trade terms.
Economists, including those at the International Monetary Fund, have widely viewed China's efforts to prop up the yuan's value over the past year as evidence that Beijing is no longer keeping its currency artificially low to make Chinese exports cheap.
(Reporting by Steve Holland in Baton Rouge and David Lawder in Washington; Editing by Jonathan Oatis)