- Trumps trade consultant Peter Navarro accuses the Federal Republic of Germany, other countries to exploit the low interest rate policy of the ECB.
- criticism of the cheap Euro had also been issued under the US President Obama.
- Nevertheless, it is significant in a rude response brought accusation for two reasons.
The sound between the government of Donald Trump and the Federal government is harsh. Peter Navarro, the chief Advisor Trumps in trade policy, accused Germany, using the low rate of the Euro for other countries to “exploit”. The Euro was last 1.07 $ and is rated so that, in the opinion of most experts. Indirectly, Navarro accused the Federal government, you will have to press the exchange rate to the bottom. He avoided it, however, to speak of Manipulation, as Trump and his government had done in the case of China.
prices rise – the ECB must act now
Merkel rejects the allegations. But Germany benefits from the cheap Euro
German Chancellor Angela Merkel dismissed the allegations of Navarro’s. “Germany is a country that has always advertised that the European Central Bank, an independent policy, so how it has also made the Bundesbank, as there was no Euro,” Merkel said during a visit to Stockholm. “Therefore, we will take on the behavior of the ECB, also no influence. Therefore, I also at the Situation as it is, and I want to change anything,” stressed the Chancellor. Marcel Fratzscher, President of the German Institute for economic research (DIW), wrote in a Tweet: “Navarro is next to it. Without Germany the Euro would be much weaker.”
The cheap Euro makes German exports cheaper and contributes to the high Surplus in the current account. The high level of exports promotes economic growth. For the first time in eight years, Europe is ahead of the United States: As the statistics office Eurostat announced, the increase in gross domestic product (GDP) in the Euro Zone in 2016 to 1.7 per cent, in the United States, by contrast, it grew by just 1.6 percent to
From the Financial Times Navarro, the head of the Donald Trump’s newly installed National Trade Council, said that Germany was one of the main obstacles for a trade agreement between the EU and the United States. The planned and, especially in Germany, a controversial agreement TTIP was “dead,” said Navarro. The government’s Trump to prefer bilateral trade agreements with other States against groups of States. The TTIP could not be seen as a bilateral agreement.
accusations Of “currency manipulation” is centrally located in the US trade policy
lays The blame for the Failure of TTIP Navarro in Germany. The Federal Republic of loot other countries such as the USA, with its crass under-rated “implicit Deutsche Mark” (from the Euro). The trade imbalance between Germany and the Rest of the EU and the U.S. underline the economic heterogeneity within Europe.
The German export surplus, which amounted in the previous year, more than eight percent of the gross domestic product, was already under Barack Obama’s rise to the German-American dispute. New in the Interview, Navarro’s, the aggressive language and the concentration on the question of the exchange rate. This is controversial for two reasons. First of all, the cheap Euro is mainly a consequence of the monetary policy of the European Central Bank (ECB), and the control of the Federal government. Secondly, the accusation of “currency manipulation” in the American trade law a Central role. A country, officially the Manipulation of the exchange rate is accused of, have to expect sanctions, for example, criminal duties. So far, China is always the focus, now Germany’s turn.
At the start of trading in New York, the Dollar traded weaker. At times, you had to pay for one Euro more than, $ 1.08, a penny more than before the publication of the Navarro-Interviews. Many traders expect seems to be that Trump will operate a policy of a weak dollar. Exciting the further course of the US will now be the Federal Reserve Bank. The open market Committee of the Fed will publish on Wednesday its decisions. The financial markets hope for new insights about when the Fed the next Time the interest rates will increase.
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