Amidst the differences between the Republicans and Democrats, the US senate has adjourned its vote on the much-debated currency bill until next week. The bill would help imposing penalties on goods from Countries which keep their currencies intimately low. To gear up exports politicians and some business groups have accused China of using its policy of limiting the Yuan’s value.
"I think China needs to carefully think about and process the substance of what people are saying here on the floor of the United States Senate," said John Kerry, chairman of the Democratic Senate Foreign Relations Committee.
Despite the slowdown in the US economy, currency policy of China grabs all attention. President Barack Obama said "China has been very aggressive in gaming the trading system to its advantage and to the disadvantage of other countries, particularly the United States".
"It is indisputable that they [China] intervene heavily in the currency markets and that the RMB [yuan], their currency, is lower than it probably would be if they weren't making all those purchases in the currency markets."
The undervaluation of Yuan has not only proved unfairly advantageous to Chinese exporters, but it has also added to the payoff situation in the US., said the politicians and policy makers.
Mr Schumer added that if no action was taken against China's policies the US "may never recover as a country. This is serious stuff".
Mr Obama, however warned to maintain vigilance to solve the matter. He said, "My main concern and I've expressed this to Senator Schumer, is whatever tools we put in place, let's make sure that these are tools that can actually work, that they're consistent with our international treaties and obligations."
Additionally some politicians report that the bill may harm rather than benfit the US economy.
Bruce Josten of the US Chamber of Commerce wrote to the Senators earlier this week.
"Unilateral action by the United States will only serve to increase trade tensions and negatively impact the US economic recovery during this fragile period in the global economy,"
