WASHINGTON - The US Treasury Department on Tuesday declined to name China as a currency manipulator, saying that it would closely monitor the pace of RMB appreciation.

The latest Semi-Annual Report to the Congress on International Economic and Exchange Rate Policies released on Tuesday highlighted the need for greater exchange rate flexibility, most notably by China, but also in other major economies.

"Based on the ongoing appreciation of the RMB against the dollar since June 2010, the decline in China's current account surplus, and China's official commitments at the G20, APEC, and the US-China Strategic and Economic Dialogue (S&ED) that it will move more rapidly toward exchange rate flexibility," the Treasury concluded that China did not meet the standards of a currency manipulator.

"Treasury will closely monitor the pace of RMB appreciation and press for policy changes that yield greater exchange rate flexibility, a level playing field, and a sustained shift to domestic demand-led growth," noted the Treasury.