Speaking this morning at the World Economic Forum in Davos, Switzerland, Treasury Secretary Steven Mnuchin said he's not concerned with the recent weakening of the USA dollar because when the currency goes down, it makes us goods less expensive in other markets.
The Singapore dollar surged to its highest in three years against the US dollar on Thursday (Jan 25), after US Treasury Secretary Steven Mnuchin said he would welcome a weaker greenback. The one-two punch of protectionism and devaluation also sparked a rally in gold. "Given the market's willingness to blindly sell the dollar, such comments only help". International Monetary Fund Managing Director Christine Lagarde on Thursday urged Mnuchin to explain, adding that US tax cuts will probably cause the dollar to rally.
Mnuchin said the U.S.is not seeking to use the currency as a weapon in any trade war but that the USA government will do all it can to bolster US business.
The Dow Jones Industrial Average rose 51.4 points, or 0.2 percent, to 26,262.21, the S&P 500 lost 3.03 points, or 0.11 percent, to 2,836.1 and the Nasdaq Composite dropped 43.40 points, or 0.58 percent, to 7,416.89.
Stocks were lower in afternoon trading, giving up morning gains, and analysts said one factor was some concern about the dollar remark and the potential for protectionist USA actions.
Trump is due later at the World Economic Forum and is expected to argue that his policies, created to boost the US economy, should be welcomed by the global business community. Fair enough, but a day before he raised tariffs against foreign goods including solar panels and washing machines. "In the longer term, a stronger dollar is a reflection of the strength of the USA economy". "Unfortunately, every single day there are various parties trying to violate the rules, and trying to take unfair advantage of things ... the difference is that USA troops are now coming to the ramparts". "We are not looking to get into trade wars". The currencies of emerging-market economies are also rising against the dollar, which helps them attract much-needed capital, reduces import prices and increases their consumers' appetite for American goods. Whereas a year ago the US dollar was rallying in anticipation of what it would mean for growth in what looked like one of the few rapidly-expanding parts of the world, today there's plenty of choice.
Benchmark U.S. crude rose $1.14, or 1.8 per cent, to $65.61 a barrel in NY.
Analyst Joe Manimbo with Western Union says the tone of the remarks served as a compelling sell signal for the US currency which plunged through key supports. Decliners outpaced advancers by a 1.2-to-1 ratio.
Sterling climbs more than 1.5% against the dollar on Wednesday afternoon, gaining more than two cents on the greenback.
The Treasury chief was asked whether USA stocks, which have set a series of record highs, are overheated.
BRUSSELS (AP) - European regulators fined Qualcomm $1.23 billion after concluding the US mobile chipmaker bribed Apple to stifle competition by using its products exclusively in iPhones and iPads.
In late-morning trades, the benchmark S&P/ASX 200 Index is losing 11.80 points or 0.19 percent to 6,042.90, off a low of 6,029.10. Brent crude, used to price worldwide oils, added 25 cents to $70.21 a barrel in London.