USA dollar drops sharply after Trump calls it 'too strong'
- Author: Zachary Reyes Apr 14, 2017,
Apr 14, 2017, 15:17
The data came amid a warming of relations between China and USA, with Trump backing away from labeling China a currency manipulator in an interview with the Wall Street Journal.
Gold, silver and prices for other metals leapt Thursday, bolstered as the U.S. dollar was shoved lower after U.S. President Donald Trump said the currency has been trading at "too strong" of a level.
In apparent reversals from previous positions, he also said China isn't manipulating its currency - doing so would hurt talks with Beijing on dealing with North Korea - and that he wouldn't rule out re-nominating Federal Reserve Chair Janet Yellen once her four-year term is up next year.
It dropped seven-tenths of a percent, after president Trump told the Wall Street Journal the dollar is "getting too strong".
The US leader had promised to label China as a currency manipulator on his first day in office, a move that would have initiated a process that includes talks but could lead to imposing unilateral trade sanctions, which nearly certainly would have sparked retaliation. Trump began to bash China in the 2015 speech that began his campaign, saying Beijing kept its currency artificially low to give its manufacturers an unfair advantage in global trade.
The Trump organization's first financial report is set to be discharged in mid-April and will layout whether major USA exchanging accomplices are gaming their monetary forms. "But that's hurting - that will hurt ultimately", Trump, who has talked the dollar down several times since his election, told the paper. "... While they're not manipulating their currency at the moment because it doesn't suit their economic needs, make no mistake about it, as soon as the tide turns they will".
Sayed added that backing away from labeling China a currency manipulator was seen as a positive development by markets, "as it eliminates the risk of China dumping its U.S. Treasury holdings and reduces the potential for further tensions between the world's largest two economies".
Trump, in an interview with the Wall Street Journal on Wednesday, appeared to acknowledge that China hasn't been intervening to weaken its currency recently.
The US dollar index, which measures it against a basket of other currencies, slid after Trump's remarks. US crude rose 0.2 percent to $53.20 a barrel, and global benchmark Brent was also up 0.2 percent at $55.96.
He had previously been critical of her during his campaign trail and indicated she should step down.
In February of 2016 Trump said, "and if they don't stop devaluing we're going to have to charge them a tax on the goods coming in".
But since taking office, he's taken a lighter tone. But I think Mr. Trump is betting on the notion that trade is very important for China.
With the departure last week of Daniel Tarullo, a Fed board member, Trump now has the chance to fill three of the seven seats of the board.