The dollar, Renminbi, Geithner, and India

Yes, those four belong in the same context because the US Treasury Secretary is in India, even as the world is getting more and more interested in the tensions over the US' concerns that China is holding its currency down at an artificially lower exchange rate.

First, these tidbits about Geithner and Obama:

During the early 1980s, Geithner's father Peter Geithner oversaw Ford Foundation's microfinance programs in Indonesia developed by Ann Dunham Soetoro, President Barack Obama's mother. Prior to that, Geithner Sr headed the Ford Foundation operations in India, which led to a toddler Tim spending his early years in New Delhi, where he had a crack at cricket but remained true to baseball.

So, tidbits aside, what is the Secretary thinking about these days with the China report due in less than a fortnight?

Geithner suggests, it is the level of comfort US has with India's transparency and fairness, compared with China, with whom Washington has been on the verge of an ugly spat over currency exchange rate manipulation. "The differences are mostly defined by the differences in our economies," Geithner said cautiously, reluctant to be drawn into a discussion on China. "We're not going to be talking in India about the exchange rate regime." India, he says, is "becoming more open, runs a flexible exchange rate regime. Its basic pattern in growth has been less export dependent, oriented over time. Different economy, different structure, different choices."

But, wait, the report on whether China is a currency manipulator is now delayed--it will not come out on the 15th after all ....
Meanwhile, according to the Financial Times:

In its latest estimate, the World Bank has predicted a growth rate of 9.5 per cent for 2010, but many analysts predict even faster expansion of the Chinese economy this year.
Growth in the first quarter alone is estimated at between 11 and 12 per cent.
...
But China’s trading partners, particularly the US, fear that its policy of holding down its exchange rate relative to the dollar is driving overseas demand for its exports which, in turn, is fuelling rapid economic expansion and inflation.

The Economist says that even if the April report does not cite China as a currency manipulator, then it will be only to give China one last chance:

The administration’s best hope is that China moves of its own accord before events in Congress or elsewhere force a confrontation. Tim Geithner, the treasury secretary, is surprisingly confident that China will act. Sander Levin, the usually interventionist-minded chairman of the House Ways and Means Committee which oversees trade matters, advocates multilateral rather than unilateral pressure. So perhaps the administration will give China one last chance and seek a multilateral remedy at the G20 in June. If China still fails to respond, the Treasury, by the time of its autumn report, will no longer be able to deny the obvious.

I tell you, we live in interesting times :)