US President Donald Trump on Wednesday accused China and Europe of deliberately weakening their currencies and stimulating their economies to gain competitive advantages over the United States.
Trump''s latest Twitter outburst came as the Commerce Department reported that the US trade deficit surged to a five-month high in May, in part on record imports of automobiles - goods on which Trump has threatened to impose steep duties. The US Treasury, however, again reported in May that China was not manipulating its currency and departing European Central Bank Chief Mario Draghi last month rejected similar accusations from Trump, saying the ECB does not target the exchange rate.
"China and Europe playing big currency manipulation game and pumping money into their system in order to compete with USA," Trump said on Twitter. Trump also implied that the Federal Reserve should likewise ease monetary policy, something he has called for in the past.
"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!" the president said. Shattering recent political norms, Trump has repeatedly lambasted the Fed and its chairman, Jerome Powell, saying that the bank''s comparatively tighter monetary policy jeopardizes US economic growth and puts the United States at a disadvantage compared to Europe and China.
The Fed has signaled it is open to lowering interest rates if necessary but analysts say markets should not be overly confident the central bank will cut rates this month.