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UPDATE 1-China denounces U.S. currency accusation

Published 01/24/2009, 02:38 AM
Updated 01/24/2009, 02:40 AM

BEIJING, Jan 24 (Reuters) - A Chinese central banker denounced accusations by U.S. Treasury Secretary-designate Timothy Geithner that China was manipulating its yuan currency, calling them misleading and warning against "excuses" for protectionism.

Su Ning, a vice governor of the People's Bank of China, called the comments by Geithner "out of keeping with the facts" and said they were "misleading in analysing the causes of the financial crisis," the official China News Service reported on Saturday.

Su also warned against trade protectionism.

"We believe that faced with the financial crisis there should be a spirit of self-criticism," Su said while visiting a business newspaper office in Beijing, according to the report.

"The international community is currently working together in actively responding to the financial crisis, and it must avoid exploiting different excuses for renewing or encouraging trade protectionism," Su said, adding that such steps would harm global economic recovery.

Geithner's comments could signal that the new administration of President Barack Obama will take a tougher line against China in seeking to narrow China's big trade surplus, which some in Washington blame for stoking global economic imbalances. [ID:nPEK2636]

The yuan closed lower against the dollar on Friday and traded mostly below the Chinese central bank's mid-point, with speculation that Geithner's comments could spark a brief period of modest yuan depreciation. [ID:nSHA22705] (Reporting by Chris Buckley; Editing by Alex Richardson)

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