Senators assured renminbi revaluation will occur by August

The co-sponsors of a bill that would impose a tariff of 27.5 percent on Chinese imports if that nation’s currency is not revalued have agreed to postpone a vote on the measure after they received assurances from the Bush administration that the renminbi will be revalued in August before the Chinese president visits Washington, DC, in September.

Senators Charles Schumer said that he and bill co-sponsor Lindsey Graham believe that the administration believes that the revaluation will take place because of the bill they introduced.

The Senators were given information in a June meeting with Treasury Secretary John Snow and Federal Reserve chairman Alan Greenspan that they took as an assurance that the revaluation would take place in August, although a Treasury Department spokesman said that the Treasury secretary did not give any time frame to the revaluation and that trying to fit it into a time-frame was counterproductive.

At the June meeting, Mr. Snow and Mr. Greenspan argued that the legislation proposed by Mr. Schumer and Mr. Graham was not a helpful tactic in trying to get the Chinese to revalue their currency because the pressure such a bill would put on China would make it politically difficult for them to move on revaluation.

Mr. Schumer is reported to have said that if China does not revalue, the proposed legislation on tariffs has enough support to pass.

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