Geithner Trip to India and China
Treasury Secretary Timothy Geithner met with top Hong Kong, Beijing, and Indian finance officials during his week long trip through Asia which focused on trade and monetary matters. Meanwhile, the New York Times reported Friday that the Chinese government was preparing to announce that it will allow its currency to rise with increased volatility. China’s currency, known as the renminbi or yuan, has been pegged at a nearly fixed rate to the dollar for many years. While an official announcement on China’s currency policy may be delayed, the Times reported that China’s central bank appears to have prevailed within the Chinese governmental leadership for a stronger but more flexible currency. Geithner has refrained from publicly commenting about the currency issue in advance of his meetings in Beijing.
Senate Financial Regulatory Reform Bill
Senate Banking Committee Ranking Member Richard Shelby (R-AL) offered to Chairman Chris Dodd a new draft compromise on the consumer protection title of the financial reform bill this week, reflecting a possible shift in the Republican position on the issue. According to sources close to Shelby, the new draft is much closer to the language Dodd and other Democrats have sought, which gives much stronger consumer protection authority to the new agency. However, the new Shelby language is said to also give a new council of regulators the power to veto rules from the agency. Shelby’s proposed compromise may reflect Republicans’ increasing willingness to appear amenable to financial reform.