[an error occurred while processing this directive]
BBC News
watch One-Minute World News
Last Updated: Tuesday, 14 October, 2003, 18:54 GMT 19:54 UK
Bush pledges Asia currency action
One US dollar
The dollar has been under pressure
President George Bush has said he will put pressure on China and Japan to stop intervening in the currency markets to boost their export sales.

Speaking on the eve of a visit to Asia, Mr Bush told reporters he would raise the issue during talks next week with Japanese and Chinese leaders.

"I'm going to say that were there's trade imbalances, countries need to be mindful that we expect there to be fair trade," he said.

"We expect the markets to reflect the true value of the currency."

Japan had adopted a policy of periodically selling yen in an effort to keep the dollar-yen exchange rate at a level which favours export sales to the US, while China pegs the yuan at an artificially low rate against the US currency.

US manufacturers claim that the Chinese yuan is undervalued by as much as 40%, making it difficult for them to compete with their Chinese counterparts at home and abroad.

By some estimates, American firms sell just $1 in China for every $6 of Chinese products sold in the US.

Strong dollar pledge

On Tuesday, a group of US senators wrote to Mr Bush urging him to take action on the currency issue in an effort to reverse a swathe of US job losses, especially in the manufacturing sector.

The Bush administration is reported to be worried that the steady loss of factory jobs - total lay offs are estimated at 2.7 million over the past 3 years - could cost it votes in next year's presidential election.

Mr Bush also insisted that his government had not wavered from the traditional US policy of maintaining the dollar's value against that of other world currencies.

"I'm for a strong dollar policy. We've had a strong dollar policy in this administration," he said.

His remarks counter recent market speculation that the US government would prefer a weaker currency in order to stimulate the economy and mend its widening current account deficit.

That speculation has contributed to a steep decline in the value of the dollar against the euro and the yen in the past three months.

The dollar was higher in late morning trade in New York, climbing 0.4% on the day to 109.4 yen.

Mr Bush's trip to Asia, which begins on Wednesday, will include visits to Japan, the Philippines, Thailand, Singapore, Indonesia, and Australia.

He will hold talks with Chinese leaders on the sidelines of the Asia-Pacific Economic Cooperation forum, which runs from 20 to 23 October in Bangkok.


FTSE 100
22.84 0.42%
18.55 0.32%
Cac 40
14.37 0.38%
Dow Jones
78.53 0.76%
35.31 1.58%
Data delayed by at least 15 minutes

Jittery dollar drops again
09 Oct 03  |  Business
Japan vows to restrain yen
01 Oct 03  |  Business
Bouncing yen batters Nikkei
22 Sep 03  |  Business
Weak dollar sparks share rout
22 Sep 03  |  Business
US blackout weakens dollar
14 Aug 03  |  Business
IMF calls for 'balanced' growth
21 Sep 03  |  Business
US backs off from 'strong dollar'
12 May 03  |  Business

The BBC is not responsible for the content of external internet sites


News Front Page | Africa | Americas | Asia-Pacific | Europe | Middle East | South Asia
UK | Business | Entertainment | Science/Nature | Technology | Health
Have Your Say | In Pictures | Week at a Glance | Country Profiles | In Depth | Programmes
Americas Africa Europe Middle East South Asia Asia Pacific