US considered weakening dollar

WASHINGTON: President Trump and his economic advisers met this week to discuss intervening in currency markets to artificially weaken the dollar, but decided against the idea, Larry Kudlow, director of the National Economic Council, said on Friday.

Trump has made no secret of his frustration that the United States dollar has strengthened against other currencies, like those of China and the eurozone, making American products more expensive to buy in those places. But a high-level discussion about whether to intervene and drive down the dollar’s value shows the extraordinary lengths to which Trump is willing to consider going to jump-start a slowing economy as he heads into his re-election campaign, New York Times reported Saturday.

The president has repeatedly complained that other currencies have been weakened by central banks taking steps to begin stimulus efforts to buttress their own slowing economies. Trump has accused those countries of manipulating their currencies, saying they are trying to limit economic damage from the tariffs he has imposed on European metals and $250 billion in Chinese goods.

The United States has historically had a “strong dollar” policy, meaning it is comfortable with a strong currency. But a strong dollar can function as an economic headwind by making American goods more expensive abroad and reducing the costs of imports. Despite touting the American economy’s strength, Trump has clamored for the Federal Reserve to lower interest rates to further stimulate growth while he considers weakening the dollar as another way of accomplishing that goal.