SINGAPORE: The US Treasury added Singapore, Malaysia and Vietnam to a watchlist for currency manipulation, putting their foreign-exchange policies under scrutiny.Singapore made the list because of its large current account surplus and net foreign currency purchases of at least $17 billion in 2018, equivalent to 4.6% of GDP, according to the Treasury.Malaysia was cited for its bilateral trade surplus with the US of $27 billion last year and its current account surplus of 2.1% of GDP. India was removed from the watch group, given that it’s met only one of the three criteria -- a “significant” bilateral surplus with the U.S. -- for two straight reports.Trade WarVietnam was at risk of meeting all three of the Treasury’s new criteria for the currency manipulator tag. The Treasury excused Vietnam’s recent currency intervention, citing movements in both directions and net foreign exchange purposes that had “reasonable rationale” to rebuild reserves.Kim Hwan, an economist at NH Investment & Securities in Seoul, said U.S.-China trade tensions may have played a role in the Treasury’s move. Malaysia was cited for improvement on its external rebalancing. - Bloomberg

Source: thestar May 29, 2019 03:11 UTC