Geithner was asked at his Senate Finance Committee confirmation hearing whether he thought China's "manipulation" of its currency remained a serious concern. "I do believe it is a significant issue," he told Sen. Jim Bunning, a Kentucky Republican who has sponsored legislation to press China to move a more flexible exchange rate policy. [That would be Bunning-Stabenow-Bayh, S.796.]The thing here is that Geithner did not blanch at Bunning's description of China's activities as "manipulation." If you will recall, The Great Paulsonio continuously resisted pressure to get Treasury to brand China as a currency manipulator. It's a small detail worth keeping in mind, methinks.
"As I said earlier, I believe it is important for the United States and the global economy that our major trading partners operate with a flexible exchange rate system and that market forces determine the level of those exchange rates," Geithner said. "I think that's very important and I will, when I have some time to think through how best to achieve that objective look forward to a chance to work with you and your colleagues on the committee on how we do that," Geithner said.
Reuters reports Geithner's coy statements before his Senate confirmation hearing. More or less, it's "I'll get back to you on that." Still, I must say that he appears more forthright in his criticism of China's practices than his Bush administration predecessors. Whether this is a prelude to some action will be very interesting to monitor: