Why Slam China On Trade If They Help With North Korea?

President Donald Trump on Sunday defended his recent about-face on calling China a currency manipulator, saying he welcomes the county's help in dealing with North Korea.

Instead, the first currency review of the Trump administration singled out China and five other countries as needing to be monitored for their currency practices.

While Trump and Chinese President Xi Jinping last week agreed to 100-day trade talks, US business leaders in China have expressed concern about a lack of progress in gaining further access to the Chinese market despite years of negotiations. Because of these actions, many economists and investors had already suspected that China wouldn't meet Treasury's criteria.

Still, despite that reversal, the report said a decade of holding down the renminbi had imposed "significant and long-lasting hardship on American workers and companies" and left China with the largest trade surplus of any country against the United States - $347 billion previous year.

The Treasury did not alter its three major thresholds for identifying currency manipulation put in place previous year by the Obama administration: a bilateral trade surplus with the United States of $20 billion or more; a global current account surplus of more than 3 percent of gross domestic product, and persistent foreign exchange purchases equal to 2 percent of GDP over 12 months.

"But the era of strategic patience is over", Pence said.

Coinciding with this new assessment was Trump's announcement that he won't declare China a currency manipulator. The designation requires intensive talks between the United States and the designated country and can lead to penalty tariffs imposed by the United States.

In its review of the practices of the other nations, Treasury said Germany, the largest single economy in Europe, should act to encourage stronger domestic demand as a way to reduce its large trade surplus.

The report came after China data showed its surplus with the United States was almost unchanged in the first quarter compared to a year earlier at $49.6 billion, and cited China's market protection as an impediment to a balanced trade relationship.

In a show of force at a time of rising tensions with the US, North Korea has showcased its new missile arsenal to the world.

South Korea was put on a monitoring list by the U.S. Treasury Department past year due to a significant bilateral trade surplus with the United States and other factors.

"They're not currency manipulators", Trump told The Wall Street Journal, explaining Beijing had not manipulated the yuan for months.

Trump's national security adviser said on Sunday that the United States, its allies and China are working together on a range of responses to North Korea.

"Additionally, U.S. Department of the Treasury established a "Monitoring List" of major trading partners that merit close attention to their currency practices".

"But this is also thought to be a part of a barter, namely the US wants China to take tougher actions against North Korea in exchange", he said.

Mr. Trump has approached foreign policy more aggressively than he said he would during his campaign, when he said he campaigned "explicitly" against foreign intervention, said Jamelle Bouie, chief political correspondent at Slate.

The declaration also came days after Trump - in a turnabout from his campaign stance - declared in an interview that his administration would not label China a currency manipulator, which could have triggered investigations. The administration has also put forward a draft proposal on renegotiating the North American Free Trade Agreement with Mexico and Canada that dropped some of the tougher positions Trump took during the campaign.