China’s central bank sharply criticized the United States on Friday, accusing it of destabilizing the global economy through what it called a “recent abuse” of tariffs. The statement came at the conclusion of the International Monetary Fund’s steering committee meeting and underscores continued tensions despite some signs of trade war de-escalation.
Pan Gongsheng, governor of the People’s Bank of China, said the U.S. tariffs “severely violated the legitimate rights and interests of other countries,” undermined multilateral governance, and disrupted long-term global economic stability. He warned that the tariffs have already triggered sharp fluctuations in financial markets, threatening the financial stability of emerging and developing nations.
Pan emphasized an urgent need for stronger international policy coordination and a recommitment to trade liberalization to avoid further economic fallout.
Meanwhile, in a conflicting narrative, U.S. President Donald Trump suggested that trade negotiations with China were underway. However, Beijing swiftly denied the claim, signaling that a meaningful breakthrough may still be elusive.
In an effort to counter domestic and international pressures, Pan also announced that China’s central bank stands ready to adjust the reserve requirement ratio and policy rates based on economic needs. He pledged a policy mix aimed at keeping liquidity abundant, reducing banks’ liability costs, and lowering overall financing costs for China’s real economy.
On the currency front, Pan reiterated China’s commitment to allowing the market to play a decisive role in exchange rate formation, while maintaining RMB flexibility and stability at an adaptive and equilibrium level.
As trade tensions simmer, both sides appear to be maneuvering carefully, but the rhetoric from Beijing suggests the path to true resolution remains fraught with challenges.
