The US Treasury has avoided labelling China a currency manipulator in a much delayed report to Congress, but it maintained that the yuan was undervalued.
The report came three weeks after the Chinese central bank vowed to loosen it currency controls amid mounting international pressure.
'What matters is how far and how fast the yuan appreciates,' Treasury Secretary Timothy Geithner said in the bi-annual report to Congress. He added that the US would 'closely and regularly monitor' the Chinese currency's movement.
By law, the US government is required to report whether any foreign economy manipulates its currency against the US dollar. But the verdict sparked anger from some politicians bent on imposing sanctions on Beijing.
US lawmakers have accused China for years of artificially weakening the value of the yuan, or renminbi, to boost its export competitiveness.
