ANZ On U.S. Tsy Currency Manipulator Watch

Monday saw ANZ note that "Vietnam & Thailand have met the 3 technical
criteria to be labelled as currency manipulators, while Taiwan is not far
behind. India could return to the Monitoring List. The US Tsy's decision to
impose the manipulator label on an economy depends on how they
assess and view the FX intervention activities of that economy. But there
is also more at stake now if an economy is tagged as a manipulator. The
US Department of Commerce in Fe issued a new Currency Rule that will
allow for countervailing duties to be imposed for under-valuation due to
government action on the exchange rate. Therefore, any economy that is
labelled a currency manipulator by the US Tsy risks having countervailing
duties imposed on some of their exports to the US. In addition, the
Department of Commerce will also make their own subjective
assessments of currency under-valuation. We expect greater sensitivity
towards exchange rate interventions by Asian central banks, as the
repercussions of being labelled a manipulator have increased greatly."