Mario Draghi took the Trump administration to task, addressing recent assertions that Germany is a currency manipulator and warning against the rollback of post-crisis financial regulation.
Speaking at a hearing in Brussels on Monday, the European Central Bank president responded to the charge by U.S. National Trade Council Director Peter Navarro and others that Germany is using a ‘grossly undervalued’ euro to gain an unfair trade advantage.
‘The ECB has not intervened in the foreign exchange markets since 2011,’ Draghi told European Union lawmakers, adding that Germany’s trade surplus was the result of productivity gains. ‘Germany has a significant bilateral trade surplus with the U.S., a material current account surplus, but it has not engaged in persistent one-sided intervention in the foreign exchange market.’
In a question-and-answer session punctuated with lawmakers’ concerns over the shifts in global economic and financial policy brought about by the change of government in Washington, Draghi also hit out at the U.S. President’s moves to begin dismantling the Dodd-Frank Act. Rolling back the compendium of financial rules intended to prevent a repeat of the 2008 financial crisis would be ‘very worrisome,’ he said.
This post was published at bloomberg
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