Friday, President Trump said he will not devalue the USD in the US trade dispute with China.
“No, we do not have to,” President Trump said when asked whether he plans to devalue the Greenback, though he added that if the Fed were to cut interest rates it “would automatically bring down the dollar a little bit,” relieving pressure on exporters.
Inside the White House, hawks have been pushing for a direct intervention in currency markets by the Treasury by pointing to a slowdown in US manufacturing, which many economists have blamed on tariffs imposed by President Trump and uncertainty surrounding his trade war with China.
Speculation has been building among strategists that US may intervene to forcibly weaken USD. The risk of US action rose further in the eyes of some analysts this week after the RMB Yuan dove to Y 2008-lows and The Trump Administration formally named China a currency manipulator.
.DXY which measures the Buck against a basket of 6 peer currencies, briefly jumped following President Trump’s comment before slipping back to little changed.
“We have the safest currency of the world. We have the standard of the world,” the President said as he left the White House Friday.
Have a terrific weekend