Trump says China isn’t a currency manipulator

WASHINGTON - Backing away from a campaign pledge, President Donald Trump said Wednesday that his administration won’t label China a currency manipulator in a report due this week, though he does think the U.S. dollar “is getting too strong.”

Trump also said in an interview at the White House with The Wall Street Journal that he would prefer the Federal Reserve keeps interest rates relatively low.

The president also left open the possibility of renominating Janet Yellen for a second four-year term as Fed chair. That would mark another shift from his campaign position that he would likely replace Yellen when her term as chair ends in February next year.

“I do like a low-interest rate policy, I must be honest with you,” Trump said.

The decision not to label China a currency manipulator is one of the sharpest reversals of Trump’s brief presidency. Trump began to bash China in the 2015 speech that started his campaign, saying Beijing kept its currency artificially low to give its manufacturers an unfair advantage in global trade.

A weaker Chinese currency, relative to the dollar, makes Chinese goods more affordable for American consumers and U.S. goods more expensive in China.

“China is killing us,” Trump had complained on the campaign trail. “They’re devaluing their currency to a level that you wouldn’t believe. It makes it impossible for our companies to compete.”

As a candidate, Trump pledged to instruct his treasury secretary to label China a currency manipulator immediately after he took office.

But in Wednesday’s published interview with the Journal, Trump said he had changed his mind because he now believes that China hasn’t been manipulating its currency for months and because labeling Beijing a manipulator might jeopardize his talks with the Chinese on confronting the threat of North Korea.

“They’re not currency manipulators,” Trump said.