Euro bank chief EXPLODES at USA for ruining eurozone exports as trade war looms | World | News

Mario Draghi, president of the European Central Bank (ECB), hit out at US Treasury Secretary Steven Mnuchin who broke with the strong dollar policy of previous administrations when he said a weaker dollar was good for American trade.

Mr Mnuchin’s comments reignited speculation the White House wants to devalue the US currency in a bid to boost exports as part of Donald Trump’s “America First” agenda.

A stronger euro makes it more difficult for eurozone nations to sell their products and services abroad. 

Mr Draghi suggested October’s international agreement between economies – including the US – not to talk down their currencies was being broken.

And he said recent exchange rate volatility had been sparked by “the use of language that doesn’t reflect the terms of reference we have agreed”.

When asked if the Trump administration was a cause for concern, Mr Draghi said: “Several members of the ECB governing council expressed concern.

“The concern was broader than simply the exchange rate, it was about the overall status of international relations right now.”

Mr Draghi’s comments are the strongest attack yet from the ECB on the Trump administration since it took office. 

In the past, it has warned Washington in more veiled terms of the dangers of trade protectionism.

The US dollar has fallen 14.6 percent against the euro since Mr Trump took office a year ago, including a 1.8 percent drop in the two days since Mr Mnuchin’s remarks. 

The euro rose above $1.25 for the first time since December 2014 on Thursday before slipping to $1.249 in late London trading, up 0.6 percent on the day.

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Speaking in Davos, where he is attending the World Economic Forum, Mr Trump said “frankly nobody should be talking about the dollar’s value” before adding he supported a strong US currency.

He said: “Our country is becoming so economically strong again and strong in other ways too, by the way, that the dollar is going to get stronger and stronger and ultimately I want to see a strong dollar.”

The euro’s rise continued despite Mr Draghi’s insistence that the ECB would consider loosening its monetary policy should a weak dollar lead to an “unwarranted” rise in the cost of money in Europe.

EU-US relations were also put under the spotlight when the Brussels trade commissioner Cecilia Malmström condemned American talk of a “trade war” as “irresponsible”.

Ms Malmström hit out after US commerce secretary Wilbur Ross said a trade war was already being waged and that American “troops” were now engaging.

She said: “To talk about a trade war is not good. It’s irresponsible.

“The whole world is worried the US is disengaging from the global trade arena.”

Speaking in Davos, Ms Malmström said many countries concerned about the Trump administration’s stance on trade now want to do trade deals with the EU — citing Japan and the Mercosur bloc of Latin American nations.