Tuesday 22 October 2019

US President Donald Trump lashes out after ECB President Mario Draghi sinks euro

Mario Draghi (Photo: Bloomberg)
Mario Draghi (Photo: Bloomberg)
US President Donald Trump. Photo: Evan Vucci/AP Photo

David Chance, Economics Correspondent

US President Donald Trump hit out at European Central Bank Chief Mario Draghi after he gave the clearest hint that the ECB would cut interest rates and relaunch its bond buying in a move that pushed the euro sharply lower against the dollar.

“Mario Draghi just announced more stimulus could come, which immediately dropped the Euro against the Dollar, making it unfairly easier for them to compete against the USA,” Trump tweeted soon after the ECB President’s speech on Tuesday.

“They have been getting away with this for years, along with China and others.”

In the immediate wake of Draghi’s comments, the euro fell 0.3pc to a two-week low of $1.1182, according to Reuters.

“If the crisis has shown anything, it is that we will use all the flexibility within our mandate to fulfil our mandate,” Draghi said Tuesday, in comments that analysts said indicated the ECB would cut rates this year and start buying new bonds.

READ MORE: Euro dives after ECB's Draghi hints of more stimulus

Last month, the US Treasury put Ireland, Germany, and Italy on a watch list for currency manipulation, one of the measures it uses to assess whether countries are taking advantage of the US in trade.

READ MORE: Ireland on US watchlist of trade threats

Data released on Tuesday showed EU exports to the US grew 11pc in April from a year ago to €145.1bn.

Trump has threatened to impose tariffs on car imports, a move that would hit the EU hard. Although the proposed measures are in abeyance at the moment, Trump has recently increased his attacks on the EU.

Ireland would be the hardest hit of any country if Washington DC Imposed universal tariffs, according to a new study by the International Monetary Fund.

Trump is in the process of stepping up tariffs against China in a bid to end its trade surplus with the US and to crimp its ability to compete with the US in areas such as technology.

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