TD Securities: Asia's Currency Manipulators

TD Securities note that "the U.S. Treasury Report on trading partners' FX policies is likely to be released soon, possibly this week. In the period since the timeframe covered in the last Report we think USD buying FX intervention has intensified."

• "We find that almost all Asian countries except Indonesia, Singapore and Philippines breached the first criteria, having a bilateral trade surplus with the US of $20bn or over. Unsurprisingly China registered the biggest bilateral trade surplus with the U.S."
• "Similarly, almost all countries in the region except China, India and Indonesia registered current account surpluses in excess of 2% of GDP over 2020. Singapore and Taiwan recorded the biggest surpluses at 17.6% and 14.1% of GDP, respectively."
• "Most countries also breached the FX intervention criteria and purchased USDs for 6 or more months of 2020. India bought the most USDs according to our calculations. However, as a percentage of GDP Singapore intervened the most."
• "We find that Thailand and Taiwan breached all three criteria and are likely to be labelled currency manipulators. According to our calculations China will not be labelled as a currency manipulator."