U.S. lawmakers have been quick to condemn the sudden drop in the value of Chinese currency as damaging for American businesses and workers, reviving an issue that was once one of the biggest sources of tension between the two world powers.
John Frisbie, president of the US-China Business Council, which advocates for American businesses, said its membership is typically more concerned about the impact of China's economic slowdown, rising costs, regulatory restrictions and intellectual property theft than currency.
He stressed the importance of China undertaking further economic and financial reforms before it can have a fully convertible currency and market-driven exchange rate. Otherwise, he said it risks capital flight, which could lead to a lower exchange rate.
"For those who feel like China's exchange rate is an issue, they might not like the result if China suddenly started allowing those market influences to be felt before they had fully reformed the economy behind it," he said.