In this undated photo, a teller counts and arranges US dollar notes at a branch of Agricultural Bank of China in Qionghai, Hainan province, China. (PHOTO / CHINA DAILY)

WASHINGTON - The US Treasury Department said on Wednesday that no major trading partner of the United States manipulated its currency. 

In its Semi-Annual Report to Congress on International Economic and Exchange Rate Policies, the Treasury Department concluded that no major trading partner of the United States met the standard of currency manipulation during the four quarters ending June 2018.

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We will not engage in competitive devaluation, and will not use the exchange rate as a tool to deal with trade frictions

Yi Gang, Governor, the PBOC

However, it put China, Germany, India, Japan, South Korea and Switzerland on its "monitoring list," which means their foreign exchange policies bear close monitoring. 

The Treasury Department said it places "significant importance" on China adhering to its commitments to refrain from engaging in competitive devaluation, while expressing its concern about the depreciation of the Chinese currency renminbi (RMB).

"China could pursue more market-based economic reforms that would bolster confidence in the renminbi," said the department.

Yi Gang, governor of the People's Bank of China, the central bank, said last week that China will continue to let the market "play a decisive role" in the formation of the RMB exchange rate.

"We will not engage in competitive devaluation, and will not use the exchange rate as a tool to deal with trade frictions," Yi said in a statement to a meeting of the International Monetary and Financial Committee. 

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Markus Rodlauer, deputy director of the Asia and Pacific Department at the International Monetary Fund (IMF), believed that the RMB exchange rate is "broadly in line" with China's economic fundamentals.

"According to our framework, the exchange rate of the renminbi is not out of line. It is broadly in line with the fundamentals," Rodlauer told Bloomberg last week.