- Trump takes aim again at the Fed, this time following an ECB rate cut that sent the euro lower.
- Trump tweets that that ECB is "succeeding" in "depreciating the Euro against the VERY strong Dollar, hurting U.S. exports" while the Federal Reserve "sits, and sits, and sits."
President Donald Trump took aim at the Federal Reserve again, this time following an European Central Bank rate cut Thursday that sent the euro lower.
Trump tweeted that the ECB is "succeeding" in "depreciating the Euro against the VERY strong Dollar, hurting U.S. exports" while the Federal Reserve "sits, and sits, and sits."
The euro dropped 0.75% below $1.09 on Thursday after the ECB cut its main deposit rate by 10 basis points to -0.5%, a record low but in line with market expectations. The central bank also relaunched a quantitative easing program to boost the region's economy.
Trump has been vocal about his disapproval with the Fed's cautious approach with interest rate cuts and his dislike for the stronger dollar. Trump has ripped on the Fed, blaming the central bank's relatively "high" interest rate levels for the dollar's strength.
On Wednesday, Trump tweeted that the Fed "boneheads" should cut interest rates to zero "or less," blaming the central bank's policymakers for slowing economic growth.
The dollar hit a two-year high last week as slowing global growth and more aggressive monetary easing overseas sent investors into the reserve currency. A weaker dollar makes it cheaper for people overseas to buy U.S.-made products. However, administrations have traditionally said they favored a strong dollar since assets like U.S. Treasurys are widely held around the globe.
When asked about Trump's tweet saying the ECB is "depreciating the euro against the dollar," ECB President Mario Draghi said "we have a mandate, we pursue price stability and we don't target exchange rates, period."
The dollar index was 0.45% higher on Thursday at $99.08.
In July, the Federal Reserve lowered interest rates 25 basis points for the first time since the financial crisis. Fed Funds watchtool is estimating a 88.8% chance of a 25 basis point rate cut at the Fed's September FOMC meeting next week.