BEIJING, May 25 (Reuters) - Chinese state media said on Friday that U.S. relations with Beijing were being used as a "political football" between Democrats and Republicans who have an eye on next year's presidential election.

U.S. President George Bush voiced disappointment after meeting China's top trade official, Vice Premier Wu Yi, at the White House on Thursday.

Wu met Bush after two days of bilateral economic talks failed to douse anger in Washington over Beijing's resistance to a sharp revaluation of its currency, which many blame for the United States' ballooning trade deficit with China.

The overseas edition of the People's Daily, the chief voice of the ruling Communist Party, said China-U.S. trade tensions were becoming dangerously "politicised" amid rivalry between Bush's Republicans and the Democrats who hold Congress.

"China-U.S. relations have been a political football in contention between the two parties," a commentary in the paper said, citing "rising protectionist sentiment in Congress" and proposals to impose tough tariffs on Chinese goods as a way of forcing China to make its yuan -- and its exports -- more expensive.

"These Congress members have not attained their goal and they will not let matters rest," said the commentary, written by a researcher at a state think-tank. "Next year sees the U.S. election, and imbalances in China-U.S. trade may become politicised and a controversial issue during the race."

Wu, speaking to a group of U.S. business leaders late on Thursday, said China was willing to promote flexibility of its currency but added that Beijing would keep the yuan "basically stable at a reasonable, balanced level".

Many lawmakers believe China's currency is undervalued by as much as 40 percent, giving it an unfair price advantage in international trade. The currency issue embodies many of the frustrations lawmakers feel about the huge trade deficit with China, which hit a record $233 billion last year.

"If China and the Bush administration won't take action to bring about more balance, there is growing sentiment in Congress to act," Senate Majority Leader Reid said in a statement after meeting with Wu.

The Chinese paper said "wise heads" on both sides could nonetheless overcome these difficulties and improve trade relations.

AlertNet news is provided by