Investing.com - The dollar slipped on Monday as U.S. President Donald Trump criticised the Federal Reserve and global monetary policy over the weekend.
On Friday, U.S. President Donald Trump accused the European Union and China of manipulating their currencies.
"China, the European Union and others have been manipulating their currencies and interest rates lower," Trump said in a tweet over the weekend. That, coupled with U.S. interest rate hikes, was weakening U.S.’s economy as the dollar strengthened, Trump claimed.
In a separate tweet, Trump added that "[t]ightening now hurts all that we have done." That came after the president told CNBC in an interview that he was "not thrilled" about the central bank hiking interest rates.
His comment led to the downfall of dollar, which saw a one-year high on Wednesday after Federal Reserve Chairman Jerome Powell’s comment indicated rising interest rates in the future.
U.S. Treasury Secretary Steven Mnuchin clarified at the G-20 meeting over the weekend that Trump didn’t intend to interfere with the Fed’s decision. “The administration completely supports the Fed's independence. Where the Fed ends up on interest rates is one, completely up to them, and [two], is also dependent upon what happens to the economy.”
Despite his efforts in easing the tension, the dollar continued to fall.
The U.S. dollar index, which tracks the greenback against a basket of currencies, traded at $94.06 at 1:05AM ET (05:05 GMT), down 0.2% from the previous session.
Meanwhile, the USD/CNY pair slipped 0.08% to $6.7650, while the euros went up against the dollar to 1.1740. Trump lashed out at China and the European Union for manipulating their currencies over the weekend and keeping their interest rates low. He tweeted, “The U.S. is raising rates while the dollars get stronger and stronger with each passing day - taking away our big competitive edge.”
Elsewhere, the USD/JPY pair also dropped 0.48% to $110.9 following events over the weekend. Japanese stocks were under pressure by strength in the yen, with the Nikkei 225 down more than 1% on Monday.