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The dollar index, which measures the greenback versus a basket of six major currencies, was on the cusp of reducing its biggest daily loss in three weeks. Against the yen, he had to record his worst daily decline in two months.
To contain the advance of inflation in the world's largest economy, the Fed has raised its interest rates seven times since 2015 and is considering at least two more increases this year. This practice increases the cost of money and can have an impact on growth but, at the same time, avoids overheating of the economy.
However, with unemployment at its all-time low and inflation rising slightly, the Fed chairman argued that the economy is strong enough to operate at more interest rates. high.
Despite the rise in trade tensions, the dollar has accumulated a 3% appreciation over the last three months, supported by expectations that the US central bank will continue to raise interest rates in the United States. months to come.
Trump's comments on the trade have caused the yuan to fall by more than half a point in London before the Chinese currency appreciates at 6.7804 units per share. dollar in the session in New York. The euro also appreciates 0.56% to $ 1.1706
The Fed, in view
For Trump, on the other hand, the monetary tightening "night to all we have been The United States should be able to recover what they lost due to the illegal handling of coins. "" Debt maturities are approaching and we are raising rates, really? " Trump said, in an obvious reference to the Fed.
Thursday, CNBC announced an advance of the interview in which the president questioned the policy The Fed broke the tradition of the executive branch of refraining from commenting on the entity so not to undermine his independence.
"I'm not happy," with the highest rates, said Trump. "It does not make me happy, but at the same time I let them do what they think is better," he said. In addition, in the interview with CNBC, Trump threw even more fuel into the bonfire of the trade war with China by suggesting that he plans to tax all products of this origin.
China still aims
[19659006] "I am ready to reach 500", said the president to CNBC, referring to the entire 505 billion US dollars of Chinese imports to United States in 2017.
"I do not do that for politics, I do it to do the right thing for our country," he said. "We have been cheated by China for a long time."
After the adoption of the import duties on steel and aluminum, a move that directly affects China, Washington has adopted Additional fees At the same time, the Commerce Department has already admitted that studies are being developed to define a list of Chinese products that could be priced and this would reach $ 200,000 million. Beijing denounced the first steps of the "biggest trade war in the history of the economy" and made it clear that it would apply retaliatory measures to every US customs tariff.
For Washington, it has become essential to reduce the huge trade deficit China, which in 2017 reached the astronomical figure of 375 000 million dollars. Last year, the United States exported to China for about 130 billion US dollars, but imported Chinese products for 506 billion US dollars.
Warning Lights
The International Monetary Fund (IMF) The IMF Chief Economist, Maurice Obstfeld, said the specter of a trade war widespread is "the greatest short-term threat to global growth". 19659006] But if that were not enough, the United States opened serious trade disputes with its traditional allies, such as the EU, Canada and Mexico, and the President of the European Commission, Jean-Claude Junker, will land in Washington next week. trade tensions
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