US Treasury accepts currency interventions by trading partners

The US Treasury Department assessed the policies of major trading partners of the country. The assessment revealed that some of the currency interventions recently conducted by the partners in the currencies market can be justified. In addition, the US Treasury Department reported that a rising dollar was fueled by the developments in the US economy.

The US Treasury Department delivered its semiannual report to Congress on the economic and monetary policies of major U.S. trading partners and commented on it. According to the report, none of the U.S. trading partners is referred to as currency manipulator.

The US dollar rose against most major currencies this year. The Fed's most aggressive policy tightening since the 1980s had a huge impact on the dollar. 

Japan intervened to strengthen the yen for the first time since 1998 in late September to prop up yen, which had declined against the U.S. dollar.

As reported by the US Treasury Department, China and South Korea also intervened in foreign-exchange markets. 

According to the Treasury Department official, the authorities expect the strengthening of the dollar to be short-lived, as the pace of Fed tightening  nears its peak. In addition, central banks in other countries are catching up and raising interest rates.