Donald Trump takes aim at eurozone in furious series of tweets ‘Euro is devalued!’
The US President also renewed complaints about the Federal Reserve, while berating US interest rates for being too high. Tweeting on Tuesday evening, Mr Trump said: “The Euro and other currencies are devalued against the dollar, putting the US at a big disadvantage.” The US President failed to explain why he felt the US was at a disadvantage but he continued: “The Fed Interest rate way too high, added to ridiculous quantitative tightening! They don’t have a clue!”
President Trump has long broken with decades of precedent set by previous US leaders who distanced themselves from the nation’s monetary policy.
The central bank, whose political independence is seen as key to economic stability, is under pressure amid the Trump administration’s ongoing trade wars and other signs of potential economic weakness.
The Fed’s Federal Open Market Committee, charged with setting key US interest rates, could decide to cut rates in coming months given recent weak job and inflation data.
President Trump again waded into the issue in another outraged tweet.
The Euro and other currencies are devalued against the dollar, putting the US at a big disadvantage
He said: “The United States has VERY LOW INFLATION, a beautiful thing!”
Mr Trump’s latest comments come just hours after a separate attack on the Fed on Monday, where the President claimed central bank policy put him at a disadvantage in his trade negotiations with China.
He argued that China, with closer political control of its central bank, could devalue its currency or use other tools to offset the tariffs Trump has imposed on Chinese imports.
In an interview with CNBC, he said: “Our Fed is very destructive to us… They haven’t listened to me.”
Fed Chair Jerome Powell and other officials insist they can only consider what is happening in the economy and the appropriate policy response, and not try to second guess what the administration does or might do.
Last week Mr Powell appeared to hint that a rate cut could be happening, citing a response needed for the global trade war.
Mr Powell said: “We do not know how or when these issues will be resolved.
“We are closely monitoring the implications of these developments for the US economic outlook and, as always, we will act as appropriate to sustain the expansion, with a strong labour market and inflation near our symmetric two percent objective.”
The Fed chairman’s comments come a day after St. Louis Federal Reserve President James Bullard said in a speech that a rate cut may be needed “soon”.
John Doyle, vice president of dealing and trading at Tempus Inc, a foreign exchange market specialist, said: “We are likely seeing the beginning of coordinated Fed-speak to prep market participants for at least one rate cut this year.”
Fed Board of Governors Vice Chair Richard Clarida told CNBC on last week: “We’ll look at market pricing.
“Market pricing can go up and down so we can’t be handcuffed to that.”
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