S2146-119

What This Bill Does

The China Exchange Rate Transparency Act of 2025 requires the Secretary of the Treasury to instruct the U.S. representative at the International Monetary Fund (IMF) to advocate for greater transparency from China regarding its currency exchange rate policies. The bill responds to Treasury Department findings that China is an "outlier among major economies" in failing to disclose how it manages its currency, the renminbi.

Who Benefits and How

U.S. trade policy interests and financial transparency advocates benefit because increased visibility into China's exchange rate practices would help determine whether China is manipulating its currency to gain unfair trade advantages. American exporters and manufacturers competing with Chinese goods would benefit from a more level playing field if currency manipulation is identified and addressed. The IMF and international financial system benefit through stronger surveillance tools and leverage over China's compliance with existing monetary commitments.

Who Bears the Burden and How

The People's Republic of China would face increased scrutiny and pressure to disclose its foreign exchange intervention activities, currency management objectives, and how it uses Hong Kong's financial system to influence exchange rates. China could face consequences in IMF governance reviews affecting its quota and voting shares if found non-compliant. The IMF administration bears an increased reporting and surveillance burden. The Treasury Department must submit annual reports to Congress describing compliance efforts.

Key Provisions

• Mandates U.S. advocacy at IMF for China to increase transparency on currency exchange arrangements, including indirect interventions through state-owned enterprises
• Requires IMF consultations to note divergences between China's exchange rate policies and those of other major currency issuers (Special Drawing Rights basket)
• Directs IMF governance reviews to consider China's performance as a "responsible stakeholder" when evaluating its voting shares
• Requires Treasury to report annually to Congress on China's compliance progress
• Sets a 7-year sunset provision, with early termination if China achieves substantial compliance with IMF obligations