US and China reach currency truce after finding happy medium

Weaker yuan spelled trouble for Beijing as well

20200114N Mnuchin liu he

U.S. Treasury Secretary Steven Mnuchin, left, shakes hands with Chinese Vice Premier Liu He in Washington in October 2019.  © AP

TAKESHI KAWANAMI and YUSHO CHO, Nikkei staff writers

WASHINGTON/SHANGHAI -- The U.S. and China have eased currency tensions as they prepare to sign a "phase one" trade deal in Washington on Wednesday, with both sides eager to keep the yuan from weakening further.

Washington lifted its designation of China as a currency manipulator on Monday, having imposed it in August for the first time in 25 years as a move that opened the door for further sanctions.

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