In another sign of thawing in relations, the US Treasury officially resigned Monday's decision to call China a currency manipulator.
"The Treasury has decided that China should no longer be classified as a currency manipulator at this time," the ministry said in its semi-annual report on currency interventions.
Treasury announced that the Phase One Trade deal to be signed this week includes China's enforceable commitments to avoid currency devaluation and not target its exchange rate for competitive purposes.
China has also agreed to publish relevant information on exchange rates and external balance sheets.
According to the report, the Treasury previously classified China as a currency manipulator after the country "took concrete steps" in the summer to devalue the renminbi. After a devaluation of up to RMB 7.18 per US dollar in early September, the RMB then rose in October and is now trading at RMB 6.93 per dollar according to the report.
The first reference to the Treasury's reversal in China came on Monday in a Fox Business Network report. This led to an extension of the Chinese Yuan's recent rally. In onshore trading
USDCNY, + 0.0000%
USDCNY, + 0.0000%
The yuan was back below $ 6.9 for the first time since late August.
The Treasury report concludes that 10 countries need special attention to their exchange rate policies, but that no major U.S. trading partner meets the criteria set out in two currency manipulation laws passed in 1988 or 2015.
The countries justifying an audit are China, Germany, Ireland, Italy, Japan, South Korea, Malaysia, Singapore, Switzerland and Vietnam.
The agency found that there were fewer currency interventions, in part because of the dollar
DXY, + 0.01%
was generally strong compared to the historical average, so countries did not have to deal with currency appreciation.
Despite President Donald Trump's efforts to reduce the US trade deficit, the gap in non-oil products has reached historic highs of over 4% of GDP, the report said.
In the meantime, the Ministry of Finance has asked Germany, the Netherlands and South Korea to use part of their financial area to provide substantial growth impetus.