{"id":37269,"date":"2018-09-02T12:53:07","date_gmt":"2018-09-02T17:53:07","guid":{"rendered":"http:\/\/olduvai.ca\/?p=37269"},"modified":"2018-09-02T12:53:07","modified_gmt":"2018-09-02T17:53:07","slug":"dethroning-the-king-five-ways-trump-could-weaken-the-dollar","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=37269","title":{"rendered":"Dethroning the King: Five ways Trump could weaken the dollar"},"content":{"rendered":"<div class=\"jumbotron\">\n<div class=\"row\">\n<div class=\"col-lg-8 col-lg-offset-2\">\n<h3><a href=\"https:\/\/think.ing.com\/articles\/us-treasury-fx-intervention-strong-dollar\/#\">Dethroning the King: Five ways Trump could weaken the dollar<\/a><\/h3>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"row\">\n<div class=\"col-md-8 padding-up\">\n<div class=\"row\">\n<div class=\"col-md-11 col-lg-10\">\n<div class=\"lead\">\n<p>Can President Trump instruct the US Treasury to\u00a0intervene in FX markets and weaken the dollar? Twelve months ago, we wouldn&#8217;t have even considered this question. But under this new\u00a0mercantilist US regime, who knows? We identify five ways in which Washington\u00a0could try to engineer a weaker dollar<\/p>\n<\/div>\n<div class=\"in-this-entry\"><a class=\"anchor\" name=\"in-this-entry\"><\/a><strong>In this article<\/strong><\/p>\n<ul>\n<li><a class=\"in-this-article\" title=\"\" href=\"https:\/\/think.ing.com\/articles\/us-treasury-fx-intervention-strong-dollar\/#a1\" data-toggle=\"tooltip\" data-placement=\"left\" data-original-title=\"Click to scroll down\">Key messages: Time to consider how Trump could weaken the dollar<\/a><\/li>\n<li><a class=\"in-this-article\" title=\"\" href=\"https:\/\/think.ing.com\/articles\/us-treasury-fx-intervention-strong-dollar\/#a2\" data-toggle=\"tooltip\" data-placement=\"left\" data-original-title=\"Click to scroll down\">White House needs a weak dollar for US trade policy consistency<\/a><\/li>\n<li><a class=\"in-this-article\" title=\"\" href=\"https:\/\/think.ing.com\/articles\/us-treasury-fx-intervention-strong-dollar\/#a3\" data-toggle=\"tooltip\" data-placement=\"left\" data-original-title=\"Click to scroll down\">Dethroning the King: President Trump&#8217;s toolkit to weaken dollar<\/a><\/li>\n<li><a class=\"in-this-article\" title=\"\" href=\"https:\/\/think.ing.com\/articles\/us-treasury-fx-intervention-strong-dollar\/#a4\" data-toggle=\"tooltip\" data-placement=\"left\" data-original-title=\"Click to scroll down\">US Treasury FX Intervention | Likelihood: Very Low | Impact: Limited<\/a><\/li>\n<li><a class=\"in-this-article\" title=\"\" href=\"https:\/\/think.ing.com\/articles\/us-treasury-fx-intervention-strong-dollar\/#a6\" data-toggle=\"tooltip\" data-placement=\"left\" data-original-title=\"Click to scroll down\">Altering the Fed&#8217;s mandate | Likelihood: Very Low | Impact: High<\/a><\/li>\n<li><a class=\"in-this-article\" title=\"\" href=\"https:\/\/think.ing.com\/articles\/us-treasury-fx-intervention-strong-dollar\/#a7\" data-toggle=\"tooltip\" data-placement=\"left\" data-original-title=\"Click to scroll down\">White House dollar jawboning | Likelihood: High | Impact: Negligible<\/a><\/li>\n<li><a class=\"in-this-article\" title=\"\" href=\"https:\/\/think.ing.com\/articles\/us-treasury-fx-intervention-strong-dollar\/#a10\" data-toggle=\"tooltip\" data-placement=\"left\" data-original-title=\"Click to scroll down\">Pressure major trading partners to strengthen their currencies | Likelihood: High | Impact: Medium<\/a><\/li>\n<li><a class=\"in-this-article\" title=\"\" href=\"https:\/\/think.ing.com\/articles\/us-treasury-fx-intervention-strong-dollar\/#a11\" data-toggle=\"tooltip\" data-placement=\"left\" data-original-title=\"Click to scroll down\">A US Sovereign Wealth Fund | Likelihood: Very Low | Impact: Medium<\/a><\/li>\n<li><a class=\"in-this-article\" title=\"\" href=\"https:\/\/think.ing.com\/articles\/us-treasury-fx-intervention-strong-dollar\/#a12\" data-toggle=\"tooltip\" data-placement=\"left\" data-original-title=\"Click to scroll down\">Bottom line: Weak dollar policy will be self-fullfilling <\/a><\/li>\n<li><a class=\"in-this-article\" title=\"\" href=\"https:\/\/think.ing.com\/articles\/us-treasury-fx-intervention-strong-dollar\/#a13\" data-toggle=\"tooltip\" data-placement=\"left\" data-original-title=\"Click to scroll down\">Footnotes<\/a><\/li>\n<\/ul>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<aside class=\"col-md-2\"><\/aside>\n<\/div>\n<section class=\"content\">\n<div class=\"row\">\n<div class=\"col-md-7 col-md-offset-2\">\n<div class=\"insert\">\n<h4>Key messages: Time to consider how Trump could weaken the dollar<\/h4>\n<ul>\n<li>President Trump\u2019s\u00a0<a href=\"https:\/\/think.ing.com\/articles\/usd-trumps-pedal-to-the-metal\/\">ramped up verbal jawboning in recent weeks<\/a> suggests that current USD strength may be the upper bound of the White House&#8217;s tolerance level<\/li>\n<li>We identify five policies that the White House could employ to weaken the dollar: (1) US FX intervention and building out US FX reserves; (2) Changing the rules of the game for the Fed; (3) Ongoing jawboning and talking down the dollar; (4) Pressuring major trading partners to strengthen their currencies; (5) Creating a US sovereign wealth fund.<\/li>\n<li>We don\u2019t think any small-scale unilateral intervention by US authorities will have a sustained impact on weakening the dollar. The best historical precedent \u2013 the Bush FX interventions in 1989-1990 \u2013 shows that this approach had a limited impact in driving the USD materially lower.<\/li>\n<\/ul>\n<p>\u2026click on the above link to read the rest of the article\u2026<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/section>\n","protected":false},"excerpt":{"rendered":"<p>Dethroning the King: Five ways Trump could weaken the dollar Can President Trump instruct the US Treasury to\u00a0intervene in FX markets and weaken the dollar? Twelve months ago, we wouldn&#8217;t have even considered this question. But under this new\u00a0mercantilist US regime, who knows? We identify five ways in which Washington\u00a0could try to engineer a weaker [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[7844,2022,8495,21493,3913,839],"class_list":["post-37269","post","type-post","status-publish","format-standard","hentry","category-economics","tag-donald-trump","tag-fx","tag-fx-intervention","tag-ing","tag-mercantilism","tag-us-dollar"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/37269","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=37269"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/37269\/revisions"}],"predecessor-version":[{"id":37270,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/37269\/revisions\/37270"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=37269"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=37269"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=37269"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}