Treasury Secretary Timothy Geithner said Sunday it is in China's interests to keep working toward a fair currency policy even as Congress is poised to take on currency manipulation in the lame-duck session.

Geithner, speaking with Bloomberg News from the G-20 meeting of finance ministers in South Korea, was asked about what obligations China would have under a pact among the countries to not devalue their currencies in order to boost trade exports.

Geithner lauded China for enacting reforms to push an economic model driven more by domestic consumption than exports and for letting their exchange rates move up.

"And they're doing that because it's in their interest," Geithner said. "Makes no sense for China to have monetary policies set by the Federal Reserve. They're an independent country, large economy. They need the flexibility to run their policies in a way that makes sense for China. And that requires that their exchange rate move up over time, as they're now doing."

The Treasury secretary was asked whether China had committed to continue on its pace of tackling yuan appreciation.

"I think it will continue, because again, I think it's very much in China's interests," Geithner said. "And, of course, they recognize it's important to the world as a whole. I mean, countries around the world are affected by what's happening in China. China recognizes that. And I think we're going to see them continue to move."

Geithner also expressed confidence that Congress would work out an extension of the Bush-era tax cuts in the lame-duck session.

"It's inconceivable to me you won't see Congress come together and figure out how to extend those middle-class tax cuts that go to, you know, people making less than $250,000 a year," he said. "That's 98 percent of working Americans, 98 percent of small businesses. I think it's overwhelmingly compelling that we — Congress act quickly to do that. And I'm sure that it will happen."

The sticking point in Congress has been whether tax cuts should be extended for all income brackets, though the administration has pushed the extension of cuts for those making less than $250,000 and accused Republicans of holding the middle class "hostage" by favoring all cuts.