By Michael R. Crittenden

WASHINGTON--A pair of Senate Democrats on Wednesday called on U.S. officials meeting for high-level talks in Beijing to "decisively confront" Chinese officials over management of their currency, calling White House efforts to date "insufficient."

In a letter timed to coincide with the latest round of the U.S.-China Strategic and Economic Dialogue, Sen. Charles Schumer of New York and Sen. Bob Casey of Pennsylvania said U.S. efforts to persuade China to allow market forces to determine the value of its currency aren't working.

"Time and again, we have heralded progress only to see it eroded by China's aggressive actions," the senators wrote in a letter to Treasury Secretary Jacob Lew, who is among a number of senior U.S. officials meeting in Beijing this week.

Mr. Lew said ahead of the meetings that he would bring up U.S. concerns regarding China's management of the yuan during the talks, though it is just one of a number of geopolitical and economic issues the two powers are expected to wrestle with as officials meet face-to-face.

U.S. lawmakers on both sides of the aisle have long expressed frustration that Beijing has suppressed the value of its currency as a way to spur economic growth. By preventing the yuan from responding to market pressures, China can keep the price of its exports internationally competitive.

While China has allowed its currency to appreciate in recent years--the yuan has appreciated nearly 15%, accounting for inflation, since 2010--U.S. officials have still expressed concern that Beijing isn't allowing market forces to determine the value of the currency. The U.S. Treasuryin April expressed "serious concerns" about the potential for China to reverse course and suppress the value of the yuan artificially.

The pace of change hasn't been enough to satisfy lawmakers such as Messers. Schumer and Casey. "It appears we take one step forward, only to take two steps backwards," the two wrote in the letter to Mr. Lew. This has led to a growing split between the Obama administration and Congress over whether additional penalties need to be put in place to ensure Beijing follows through with commitments.

A Treasury spokeswoman declined to comment on the letter but pointed to comments Mr. Lew made Wednesday in Beijing in which he said "moving to a market-determined exchange rate will be a crucial step" as China seeks to make economic overhauls.

Administration officials have long said that economic diplomacy, such as this week's talks, are the best way to encourage economic overhauls sought by the U.S. in China. Outcry from Congress, like that in the senators' letter, can help that effort, allowing U.S. officials to demonstrate the pressure they are under while speaking with their counterparts abroad.

But lawmakers in the last several years have signaled they may seek legislative means to address their concerns with currency manipulation around the world. The two senators urged Mr. Lew to use this week's negotiations "to demand clear and measurable policies to address currency undervaluation" that can also be used in ongoing trade negotiations.

"Without inclusion of strong and enforceable currency manipulation disciplines in any future trade agreement, the president's trade agenda, including the passage of the Trans-Pacific Partnership, is in jeopardy," the senators wrote.

Mr. Lew and U.S. Trade Representative Michael Froman say they are working to address currency imbalances with China and other countries through various international forums. Officials have said currency manipulation isn't part of the formal discussions for the Trans-Pacific Partnership, the 12-nation trade deal involving countries on both sides of the Pacific including the U.S., Japan, and Australia. China isn't part of the negotiations, but has expressed some interest in joining at a later date.

Write to Michael R. Crittenden at

(END) Dow Jones Newswires

July 09, 2014 12:26 ET (16:26 GMT)

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