WASHINGTON -- The US Treasury Department on Friday refused to name China as a currency manipulator, saying it would closely monitor the pace of appreciation of renminbi, the Chinese currency.

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

"China's current account surplus has declined from a peak of 10. 1 percent of GDP in 2007 to 1.9 percent of GDP in 2011 and 2.3 percent in 2012. China has taken a series of steps to liberalize controls on capital movements, as part of a broader plan to move to a more flexible exchange rate regime," the Treasury said, adding that in light of these developments, it concluded that China did not meet the standards of a currency manipulator.

The Treasury Department, however, insisted: "the process of exchange rate adjustment in China remains incomplete and more progress is needed."

According to the report, the renminbi appreciated by 16.2 percent from June 2010 through February 2013 in real terms.

In addition to paying special attention to the pace of renminbi appreciation, the Treasury Department said it would also press for further policy changes and would monitor closely exchange rate developments in all the economies covered in the report and push for concrete adherence to recent commitments made by the Group of seven industrially advanced nations, or G7, and by the Group of Twenty major economies, or commonly known as G20.

The US Omnibus Trade and Competitiveness Act of 1988 requires the Treasury to provide reports on whether its major trading partners manipulate the rate of exchange between their currencies and the United States dollar for purposes of preventing effective balance of payments adjustments or gaining unfair competitive advantage in international trade.

The US Treasury also said it will closely monitor Japan's policies and the extent to which they support the growth of domestic demand.

"We will continue to press Japan to adhere to the commitments agreed to in the G-7 and G-20, to remain oriented towards meeting respective domestic objectives using domestic instruments and to refrain from competitive devaluation and targeting its exchange rate for competitive purposes," according to the report.