Last week, Donald Trump has stated that he believes that the US dollar is currently too strong. These remarks have largely weighed on the greenback. Mr. Trump highlighted that strong dollar may ‘sound good’, yet he added that “our dollar is getting too strong…it is very, very hard to compete when you have a strong dollar and other countries are devaluing their currency”. Following Trump’s remarks about strong US dollar policy, the market experts believe that the US monetary policy is now going to change. Back in 1995, Treasury Secretary of the US, Robert Rubin has launched the US strong dollar policy due to the economic post-war conditions. However, this policy might come to an end very soon. Donald Trump also stated that he “likes a low-interest rate policy.” Further, he highlighted that he respects Janet Yellen, the Chairwoman of Fed. Moreover, Mr. Trump has abandoned his campaign promise to flag China s currency manipulator. He suggested that the US is ready to compromise on trade policy in order to get a strategic deal with Xi Jinping related to North Korea. Additionally, Donald Trump has recognized that there is no sense in protectionist policies in times of strong dollar.
Mnunchin contradicted it within last 24hrs... prolly not show their 'hand' but to telegraph to FOMC what they prefer.
Presidents historically do not make comments on their opinion on the dollar - especially when the direction they wish it to go would significantly increase their wealth - or at least reduce their debts. Not raising interest rates will destroy the economy - first all the big pension plans would collapse, next insurance companies, etc, etc.
In 274 A.D. Emperor Aurelian's zeal to protect integrity of coinage caused deflationary misery and provoked a rebellion. He was assassinated 275 A.D..
so, will Trumpers align on inflationary money printing now? Will they throw a fit when the fed tells Trump to get bent?
Of course he like low interest rates... he's got millions/billions in debt in his corporations! But he's saying the USD is too high... and other countries are devaluing... but he doesn't want to say (anymore) that China is devaluing... So which countries are? Europe? They are still lagging in economic cycle. Brazil/Mexico? Are they doing great at the moment? Japan...? Nope.... It is what it is.. USD gets stronger because their economy leads the rest, and therefore they will increase rates earlier to keep inflation in check...
Who cares whether US dollar is strong or weak. All speculators want to know is whether one currency is under or overvalued relative to another and take the advantage of the arbitrage opportunity ...
Everyone in HK cares to just give you one small example beyond your horizon. The HK dollar is pegged to the US dollar and everything that comes into HK and leaves HK is impacted by the relative value of the dollar. Has nothing to do with speculation.
Sorry ZZZ I know HK has been using the fixed exchange rate for last 30 years but they survived Asian crisis when the other tigers like Korea and Thailand collapsed. HK business people are smart enough to overcome foreign exchange risk
If trump goes all protectionist then that will lead to high inflation and stronger USD. Even if Trump thinks USD is already to high