Trump Reverses Pledge, Won't Label China Currency Manipulator

Apr 15, 2017, 05:47
Trump Reverses Pledge, Won't Label China Currency Manipulator

Rickards noted that during the campaign Trump vowed to label China a currency manipulator on "day one", but the administration has already said it won't apply the label.

A U.S. Treasury spokesman confirmed that the Treasury Department's semiannual report on currency practices of major trading partners, due out this week, would not name China a currency manipulator.

He reiterated this position in October 2016, saying: "I will direct my secretary of the treasury to label China a currency manipulator".

"They're not currency manipulators", Trump said in an interview Wednesday with the Wall Street Journal. If China ends its manipulation, the yuan will probably get even cheaper, making its goods even cheaper in the U.S.

In the interview, Trump also inveighed against the strong US dollar, saying that the strength of the currency stemmed partially from people's confidence in him, but that it was also hurting the economy. But that's hurting--that will hurt ultimately.

The yuan rose 0.2 percent as the dollar wilted after Trump said the greenback is getting too strong and that would eventually hurt the USA economy.

"The dollar is strong today because the US economy is performing better than most advanced economies and offers the promise of a higher rate of return", said Bosworth.

"We'll see whether or not he does", Trump said.

Aiming to bring congressional Democrats back to the table after the failure of the GOP effort to repeal and replace Obamacare, Trump said he would consider withholding payments to insurers in order to gain leverage in the negotiations.

Trump also signaled support for Federal Reserve Chair Janet Yellen, who he criticized during the campaign for maintaining low interest rates.

"When the President fails to label them a currency manipulator, he gives them a green light to steal our jobs and wealth time and time again", Schumer said in a statement.

"I believe Trump in his first nearly 100 days has talked about the dollar more than his two predecessors during their eight-year presidencies", said Florian Hense, an economist at Germany's Berenberg Bank. "I describe Trump's influence on currencies as a hurricane as it's both harmful and unpredictable".

Analysts at Rabobank said the market's response to Trump's election, rallying on prospects of higher growth and inflation, had left the president in a hard position.

The U.S. 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. And the markets would know he says a lot of stuff - a lot of contradictory stuff.

PRESIDENT DONALD TRUMP: President Xi wants to do the right thing.

Trump said he plans to fill two empty seats on the bank's five-member board. "It's sort of a feather bedding for politicians and others, and a few companies". "I don't like it because I don't think it's necessary". And these are companies that can do very well without it.

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