Summary:The US Treasury said the Chinese yuan is “substantially undervalued” and called for a timely, orderly appreciation. Thailand was added to the Treasury’s FX monitoring list. The report framed yuan appreciation as a necessary adjustment to reflect underlying fundamentals, particularly given China’s continued export strength and subdued domestic demand. The report lands at a sensitive juncture for markets, with currency policy increasingly intersecting with trade relations, geopolitical competition and domestic political considerations in the United States. While Treasury avoided formal escalation for now, the sharper tone underscores continued frustration with China’s FX framework and signals that exchange-rate policy will remain a central issue in bilateral economic discussions.