The U.S. Treasury labeled Switzerland and Vietnam as currency manipulators on Wednesday and added three new names to a watch list of countries it suspects of taking measures to devalue their currencies against the dollar.
Treasury said that through June 2020 both Switzerland and Vietnam had intervened in currency markets to prevent effective balance of payments adjustments.
The Treasury said in the report semi-annual currency manipulation that Vietnam had acted to gain an unfair competitive advantage in international trade as well.
The action comes as the global coronavirus pandemic skews trade flows and widens US deficits with trading partners, an irritant to Trump who won office four years ago partly on a promise to close the US trade gap.
To be labeled a manipulator, countries must at least have a $20 billion-plus bilateral trade surplus with the United States, foreign currency intervention exceeding 2% of gross domestic product, and a global current account surplus exceeding 2% of GDP.
The Treasury also said its monitoring list of countries that meet some of the criteria has grown to 10 with the addition of Taiwan, India and Thailand, others on the list include China, Japan, Korea, Germany, Italy, Singapore and Malaysia.
The Treasury also said that India and Singapore had intervened in the foreign exchange market in a sustained asymmetric manner but didn’t meet other requirements to warrant designation as manipulators.