Top news:  One day after U.S. President Barack Obama promised to "get much tougher about enforcing existing rules" on trade with China and said he would pressure Beijing to let the Yuan appreciate, the Chinese government has hit back.  Foreign Ministry spokesman Ma Zhaoxu said that the Yuan -- currently pegged at  about $6.83 per dollar -- is at a reasonable level and is not the cause of the trade imbalance between China and the United States. 

"We hope the American side sees the problems within the China-US trade co-operation objectively and reasonably and continues to negotiate on an equal basis," Ma said. "Accusations and pressure do not help to solve the problem."

Obama made his comments at a meeting with Democratic lawmakers and added that while all countries must abide by existing trade rules, it would be a mistake to resort to protectionism. "What I don't want to do is for us as a country or as a party, to shy away from the prospects of international competition," he said.

The United States has had little success in the past in pressuring China to revalue its currency. The markets seemed bearish on Obama's latest push as well with one-year dollar/yuan non-deliverable forwards implying just a 2.8 percent rise in the yuan over the next 12 months.

Meanwhile, China has also escalated a trade fight with the European Union, filing a complaint with the World Trade Organization about anti-dumping duties imposed on Chinese-made shoes. 

Toyota: Still reeling from a massive international recall due to faulty gas pedals, Toyota has acknowledged brake problems on its Prius model.