Trump: China is not a currency manipulator
Trump softened his tone on China during the interview with the Wall Street Journal.
Having previously branded Beijing the “grand champion” of currency manipulation, the President said he’d changed his mind:
They’re not currency manipulators.
The President also refused to rule out a second term for the Fed chair Janet Yellen, despite saying on the campaign trail that she would not be reappointed.
He said it was still “very early” and that she was “not toast”.
I like her, I respect her. It’s very early.
Kathy Lien, managing director of currency strategy at BK Asset Management in New York said the dollar sell-off following Trump’s comments was probably an overreaction:
The market had a big reaction, but I think it was an overreaction. He may just be hedging his bets by making sure that the American public realises he’s not backing down on trade.
The pound is up against both the dollar and the euro this morning.
Sterling is up 0.1% against the dollar at $1.2548, and 0.2% against the euro at €1.1778.
The agenda: Pound rises, dollar falls on Trump’s warning
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The pound is back above $1.25 following a warning from President Trump that the dollar “is getting too strong” because people have confidence in him.
He told the Wall Street Journal:
I think our dollar is getting too strong, and partially that’s my fault because people have confidence in me. But that’s hurting — that will hurt ultimately.
Look, there’s some very good things about a strong dollar, but usually speaking the best thing about it is that it sounds good. It’s very, very hard to compete when you have a strong dollar and other countries are devaluing their currency.
The President also suggested he would like the Federal Reserve to keep US interest rates low:
I do like a low-interest rate policy, I must be honest with you.
The comments sent the dollar index – which tracks the US dollar against six major currencies – to its lowest level since 30 March.