The US declined to label China a currency manipulator in a new Treasury report released Thursday, but accuses Beijing of standing out among America’s major trading partners for lacking transparency in its exchange rate policies.

Treasury’s semi-annual report to Congress — called Macroeconomic and Foreign Exchange Policies of Major Trading Partners of the United States— comes as the Trump administration seeks to strike a trade deal with China, averting a trade war that has been brewing between the two nations.

A Treasury official told reporters previewing the report that the US could in the future find evidence that China is manipulating its currency and will make a determination in the fall whether China has been manipulating the renminbi, also known as yuan.

During President Donald Trump ‘s first term, the Treasury, which was then led by Secretary Steve Mnuchin, labeled China a currency manipulator in 2019 — before then the US had not put China on the currency blacklist since 1994.

Treasury Secretary Scott Bessent said the administration “has put our trading partners on notice that macroeconomic policies that incentivize an unbalanced trading relationship with the United States will no longer be accepted.”

“Moving forward, Treasury will use all available tools at its disposal to implement strong countermeasures against unfair currency practices,” he said.

The decision not to sanction China for currency manipulation comes after Trump said Thursday that his first call with China’s Xi Jinping since returning to office was “very positive,” announcing that the two countries will hold trade talks in hopes of breaking an impasse over tariffs and global supplies of rare earth minerals.

“Our respective teams will be meeting shortly at a location to be determined,” Trump wrote on his social media platform after the call, which he said lasted an hour and a half.

Trump has lowered his 145 percent tariffs on Chinese goods to 30 percent for 90 days to allow for talks. China also reduced its taxes on US goods from 125 percent to 10 percent. The back and forth has caused sharp swings in global markets and threatens to hamper trade between the two countries.

US declines to label China a currency manipulator, but blasts its transparency policies