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Trump says U.S. dollar ‘is getting too strong’

Donald Trump’s admission Wednesday that he thinks the U.S. dollar “is getting too strong” and that he favors low interest rates sent the greenback and yields on U.S. government bonds down sharply.

In an interview with The Wall Street Journal, the president made headlines and moved currency and bond markets when he said the strength of the U.S. dollar was hurting the competitiveness of U.S. companies that do a lot of business abroad. Trump also admitted he’s a fan of lower interest rates, saying “I do like a low-interest rate policy, I must be honest with you.”

Trump’s words resulted in a sharp decline in the value of the dollar vs. foreign currencies. The U.S. dollar index (DXY), which was up 0.1% earlier in the session at 100.82, quickly reversed course and dipped as low as 100.14, pushing it down nearly 0.6% at its low. Ironically, while Trump complained about the dollar’s strength, the U.S. currency is actually down about 2% in 2017. The dollar, however, is still more than 2% higher since Election Day on Nov. 8.

On the dollar’s negative impact on many U.S. businesses, especially multinationals, Trump told the Journal: “It’s very, very hard to compete when you have a strong dollar and other countries are devaluing their currency.”

When the dollar is strong, it makes U.S. products more expensive when sold abroad, which crimps sales and earnings of U.S. global companies.