Dollar falls broadly on Trump's currency comments

Donald Trump has complained about trade imbalances between the US and China

Image Donald Trump has complained about trade imbalances between the US and China

Mr Trump, on Friday, lamented the recent strength of the United States dollar and accused the European Union and China of manipulating their currencies.

A Reuters report on Friday that the Bank of Japan was in unusually active discussions to modify its massive easing also played a role in the tick-up in yields globally.

US government bond yields rose as Trump repeated his criticism a day earlier of the Federal Reserve's policy on raising interest rates, saying it takes away from the United States' "big competitive edge". Tightening now hurts all that we have done.

Trump authorized the tariffs after an investigation he ordered by the U.S. Trade Representative's office found that China was violating intellectual property rules and forcing American companies operating in China to hand over their technology secrets to gain access to the market.

"At the moment, we don't know what kind of pressure or comments could come from the USA side", said Takashima.

President Donald Trump on Friday threatened to slap China with $ 500 billion worth of tariffs on import of their products into the US.

That would equal the amount of annual Chinese exports to the USA for the year.

"We're down a tremendous amount", Trump said in an interview about trade imbalances with China on CNBC broadcast on Friday. CNBC calls the rebuke "stinging and historically rare criticism", noting that presidents typically don't intercede with Fed affairs. He said he was "not happy" about recent rate hikes. "No president should interfere with the workings of the Fed", Fisher said.

The Fed had no comment.

But the president also acknowledged he was aware of the traditions that president's typically allow the Fed to operate independently to ensure the smooth functioning of the world's largest economy. "Because we go up and every time you go up they want to raise rates again", Trump said, implying the central bank could hinder economic growth.

"I'm not thrilled", the president told CNBC.

Trump said shortly after his first meeting with Chinese President Xi Jinping in 2017 that the country had stopped manipulating its currency because of his election. "But I don't like all of this work that goes into doing what we're doing".

For the Japanese Yen, a morning 0.48% rise to ¥110.88 against the Dollar came off the back of continued market jitters over the ongoing trade war pinning back the Dollar, coupled with news of the BoJ planning to discuss changes to monetary policy, though the news has yet to be commented on by BoJ members, which could see a reversal once denied. Then, his complaint was that interest rates were too low.

The rare rebuke was likely to stir a backlash as it broke with the long-established practice of the executive branch not commenting on the Federal Reserve's decisions out of respect for its independence.

The Fed has been set on a slow and steady path of interest rate hikes over the past two years, leading economists to wonder if the central bank could tamp down some of Trump's promised economic growth. The Fed is charged with keeping prices stable, often by raising interest rates to prevent the economy from overheating.

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