Author Topic: U.S. dollar sinks as Trump tweets stoke intervention fears  (Read 437 times)

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U.S. dollar sinks as Trump tweets stoke intervention fears
« on: August 23, 2019, 04:21:34 PM »
Market Watch Published: Aug 23, 2019

U.S. currency intervention may backfire anyway

President Donald Trump’s latest Twitter attack on Federal Reserve Chairman Jerome Powell on Friday, accompanied with more complaints about the strength of the U.S. dollar, is stoking long-running fears the administration could break with decades-long orthodoxy to intervene in currency markets.

Donald J. Trump
     · 5h

    As usual, the Fed did NOTHING! It is incredible that they can “speak” without knowing or asking what I am doing, which will be announced shortly. We have a very strong dollar and a very weak Fed. I will work “brilliantly” with both, and the U.S. will do great...

    Donald J. Trump

    ....My only question is, who is our bigger enemy, Jay Powell or Chairman Xi?
    9:57 AM - Aug 23, 2019

“On the back of his blistering outburst, the market is speculating whether Trump will take direct action to weaken the greenback,” said Jane Foley, senior foreign exchange strategist at Rabobank, in a note.

Despite an assurance from White House economic adviser Larry Kudlow earlier this summer that currency intervention had been ruled out, Trump’s repeated complaints about the dollar’s value relative to other currencies has underlined concerns that the administration could attempt a move to lower its value.

Trump’s latest blast, which came after Powell delivered an eagerly awaited speech at the Kansas City Fed’s annual symposium in Jackson Hole, Wyoming, was part of a series of tweets in which Trump also responded to China’s announcement that it would impose retaliatory tariffs on $75 billion worth of U.S. goods beginning in September and December. Trump prompted confusion when he also tweeted that he had “hereby ordered” U.S. companies to begin looking to alternatives to China.

The remarks were also blamed for a steep stock-market selloff, that saw stocks SPX, -2.59%  tumble more than 2%, with Dow Jones Industrial Average DJIA, -2.37%  declining more than 500 points.


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