President Donald Trump has reportedly asked aides to find a way to weaken the U.S. dollar in an effort to boost the economy ahead of the 2020 presidential election.
The president also asked about the greenback while interviewing Federal Reserve Board nominees Judy Shelton and Christopher Waller, people familiar with the matter told Bloomberg News.
Those individuals also told Bloomberg that Trump's chief economic advisor, Larry Kudlow, and Treasury Secretary Steven Mnuchin disapprove of the idea of government tampering to weaken the dollar. Traditionally, past administrations have always maintained publicly they were for a strong dollar because dollar assets like Treasurys are so widely held around the globe.
Trump has often bemoaned the relative strength of the U.S. dollar in foreign exchange markets, blaming other nations for devaluing their currencies and thereby inflating the American trade deficit. Last week, the president said in a tweet that the U.S. should match China and Europe's "currency manipulation game."
"China and Europe playing big currency manipulation game and pumping money into their system in order to compete with USA," Trump said on Twitter. "We should MATCH, or continue being the dummies who sit back and politely watch as other countries continue to play their games - as they have for many years!"
A strong dollar tends to give American consumers an advantage when purchasing foreign goods but can hurt domestic exporters as other nations are forced to shell out larger sums for goods produced in the U.S. That's proven a headache for Trump, who's made reducing the U.S. trade deficit a priority.
His questioning of Shelton and Waller come after months of White House attacks on the Fed and its hesitation to cut borrowing costs, a move that would reduce the value of the dollar as investors look for higher interest rates elsewhere.
Waller, executive vice president at the St. Louis Federal Reserve bank, reiterated to the president that central bankers don't factor the strength or weakness of the dollar when setting interest rates and instead monitor inflation and employment, Bloomberg reported. The value of the dollar is not part of the Fed's dual mandate given to the central bank by Congress.
Click here for the original Bloomberg News report.