President Trump isn’t the first politician to threaten tariffs against China for currency manipulation. In 2003, Sen. Chuck Schumer (D-N.Y.) introduced legislation calling for a 27.5 percent across-the-board tariff to compel the Chinese government to stop subsidizing exports and taxing imports by suppressing the value of its currency.
But for the past two years, Beijing’s been blowing through hundreds of billions of dollars in reserves to prevent the Chinese renminbi from depreciating further, which means there’s no longer any conceivable justification for tariffs. That makes now the perfect time to strike a deal and vanquish this overwrought and highly-politicized issue for the foreseeable future.

Currency values affect the prices of imports and exports, but currency hawks exaggerate their overall impact. With the proliferation of global supply chains and cross-border investment, the overwhelming majority of trade flows today are intermediate goods, so the effect of currency values on final prices cut in different directions.