The comment – a politically loaded term likely to raise tensions with Beijing – marked the Obama administration's first public intervention in what will be one of its most critical international economic relationships.

The US has long felt that China has artificially depressed the value of its currency to boost exports – to the detriment of US business – but the Bush administration always stopped short of formally declaring China a currency manipulator.

In a written response to questions from senators, Mr Geithner, whose nomination was supported yesterday by a clear majority of the Senate's finance committee, said: “President Obama – backed by the conclusions of a broad range of economists – believes that China is manipulating its currency.” Mr Obama would “use aggressively all the diplomatic avenues open to him to seek change in China's currency practices”, he said.