President Donald Trump said on Friday that the U.S. Dollar, the Japanese Yen and the Chinese Yuan will soon be on a "level playing field' as Japanese Prime Minister Shinzo Abe visited the White House at an American invitation.
Currency markets initially sold the dollar on the remark, driving it below 113.00 yen, though it quickly recovered.
A weaker Yen has been a cornerstone policy of Prime Minister Abe's government as he tries to encourage Japanese exports. China also has weakened the Yuan against the Dollar to boost its economy. In the last three years the Chinese currency has been devalued in ever greater amounts-- 2.55 percent in 2013, 4.63% in 2014 and 7.1% in 2016.
Mr. Trump pledged close economic and security ties between Japan and the United States, the two long time Pacific allies.
“The bond between our two nations and the friendship between our two peoples runs very, very deep,” Mr. Trump noted in his prepared statement at a news conference with Mr. Abe... “This administration is committed to bringing those ties even closer. We are committed to the security of Japan and all areas under its administrative control and to further strengthening our very crucial alliance.”
Mr. Trump campaigned on the idea that China had managed its currency for trade advantage and that he would have the Treasury Department declare the nation a 'currency manipulator", an official designation that involves trade penalties. Last week, Mr. Trump accused Japan of manipulating the Yen.
Mr. Trump took a call from the Prime Minister of Taiwan soon after becoming President leading to speculation that he was reconsidering the U.S. policy of recognizing mainland China exclusively. But In a telephone call with Chinese Premier Xi Jinping Mr. Trump said there would be no change in the 'one China policy'.
Trump did not explain how the Unites States, China and Japan would reach an acceptable currency agreement, or what a 'level playing field' was.
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