Yellen Warns Against Currency Manipulation

U.S. Treasury Secretary Janet Yellen has cautioned the incoming Trump administration against radical deregulation of the banking sector, emphasizing the importance of maintaining robust capital and liquidity frameworks to ensure financial stability. She acknowledged the regulatory system's imperfections but highlighted the risks of dismantling protections that prevent financial crises, citing the recent failures of Silicon Valley Bank and Signature Bank as examples of inadequate supervision. In a separate context, Yellen also warned against currency manipulation by other nations, asserting that the U.S. would respond strongly to such tactics while expressing confidence in the dollar's status as the world's reserve currency. She indicated that the Biden administration supports a market-driven approach to currency valuation, rejecting any attempts to artificially weaken the dollar. Yellen's statements coincide with concerns that China may consider weakening the yuan in response to potential tariffs imposed by Trump. Both sets of comments reflect her commitment to safeguarding the U.S. economy amid changing political and global economic landscapes.