President Donald Trump said on Aug. 8 that he is not “thrilled” with a strong dollar which is creating a difficult time for American manufacturers.
“As your President, one would think that I would be thrilled with our very strong dollar. I am not!” Trump said in a message on Twitter on Thursday.
“The Fed’s high-interest rate level, in comparison to other countries, is keeping the dollar high, making it more difficult for our great manufacturers like Caterpillar, Boeing, John Deere, our car companies, & others, to compete on a level playing field.
“With substantial Fed Cuts (there is no inflation) and no quantitative tightening, the dollar will make it possible for our companies to win against any competition,” he wrote.
Trump said the United States has some of the “greatest companies in the world” but commented that the same can not be said for the Federal Reserve.
“They have called it wrong at every step of the way, and we are still winning. Can you imagine what would happen if they actually called it right?” The President wrote.
The release had said, “Secretary Mnuchin under the auspices of President Trump, has today determined that China is a Currency Manipulator.”
It said Mnuchin will take the matter with the International Monetary Fund to remove the unethical competitive advantage created by China.
On the same day, Trump expressed his views on currency manipulation on Twitter.
“China dropped the price of their currency to an almost a historic low. It’s called “currency manipulation.” Are you listening Federal Reserve? This is a major violation which will greatly weaken China overtime!” Trump wrote.
The U.S. Department of Treasury explained that China is not new to facilitating an undervalued currency in the foreign exchange market.
“In recent days, China has taken concrete steps to devalue its currency, while maintaining substantial foreign exchange reserves despite active use of such tools in the past. The context of these actions and the implausibility of China’s market stability rationale confirm that the purpose of China’s currency devaluation is to gain an unfair competitive advantage in international trade,” it said.
China “has accumulated rich experience and policy tools, and will continue to innovate and enrich the control toolbox, and take necessary and targeted measures against the positive feedback behavior that may occur in the foreign exchange market,” is the PBOC’s statement quoted by the treasury.
The treasury said this statement proves that China is experienced in manipulating currency and is doing it on an “ongoing basis.”
