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Dollar slumps broadly after Trump says currency 'getting too strong'

President Donald Trump speaks during a meeting with business leaders in the State Department Library on the White House complex in Washington Tuesday

In an interview with The Wall Street Journal, president Trump said he would like to see USA interest rates stay low and that the dollar was "getting too strong" and would eventually hurt the economy.

Trump, in an interview with the Wall Street Journal on Wednesday, also said he would not label China a currency manipulator.

Yet on April 2, Trump insisted to the Financial Times that "our country hasn't had a clue, they haven't had a clue" about China's alleged currency manipulations. In a newspaper interview and a White House news conference, Trump hailed the rapport he developed with his Chinese counterpart, Xi Jinping, in meetings last week that seem to have eased trade tensions.

President Trump doesn't want a strong USA dollar.

Trading was also thinner than usual because of the impending Good Friday holiday in the US and Europe this week, Ng said.

'I think our dollar is getting too strong, and partially that's my fault because people have confidence in me, ' he said.

Investors are concerned about the upcoming French presidential election as well as possible US military action against Syria and North Korea, and an escalation of tensions with Russian Federation.

Trump added that he would be amicable to a trade agreement with China that does not do quite as much to lessen the trade deficit in order to "solve the problem in North Korea".

The US leader had promised to label China as a currency manipulator on his first day in office, a move that would have initiated a process that includes talks but could lead to imposing unilateral trade sanctions, which nearly certainly would have sparked retaliation. Otherwise, we're just going to go it alone, Trump said referring to the latest telephonic conversation with the Chinese President. That will be all right, too. That would mark the dollar's steepest weekly fall since before the US presidential election in November and the sharpest yield drop since June past year.

"It's just that he may not think now is the right time to brand China a currency manipulator", said Kathy Lien, managing director, at BK Asset Management in NY.

"I was very impressed with President Xi and I think he means well and I think he wants to help", Trump said. Trump said that any move to attach the designation could hamper China-U.S. relations.

"Donald Trump is the president of the United States, so I don't blame market participants for taking him seriously".

"China is killing us", Trump had complained on the campaign trail.

The US unit also posted slight gains against the safe-haven Japanese yen after slumping overnight to a low last seen in November. Trump is seeking China's help in dealing with an increasingly belligerent and unsafe North Korean regime.

Credit markets also benefit from a weak dollar that stimulates foreign investments. "And it actually makes money, it could make a lot of money", the president told The Wall Street Journal.

But asked on Wednesday whether he would look for a replacement for Yellen when her term expires next year, the president declined to say, suggesting Yellen might be allowed to stay on.


"Trump's verbal intervention since being elected and the resultant reflation trade has been notable", said Rabobank's Richard McGuire, with the market ran since the election seeing yields rise and inflationary expectations gather pace.