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"This is all basically hogwash," Buiter said in an interview, referring to Trump's criticism of China and Japan on their exchange rates. "All this currency-manipulator talk is, I think, basically hot air."
In recent weeks, Trump and administration officials have complained that the dollar is too strong, while accusing major trading partners - China, Japan and Germany - of weakening their currencies to gain trading advantages.
That's muddied the outlook for the greenback, which fell the past six weeks and has given back more than half of its gains since the developer and reality-TV star's election victory in November.
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"No matter how hard the Trump administration rattles the cage in an attempt to talk the dollar down, if the markets anticipate significant future stimulus in the USÂ and further tightening [interest rate rises] by the Fed, then whatever short-term wobbles there may be in the USÂ dollar, the dollar will only go one way relative to most other currencies," Buiter said. "And that's up."
The bank forecasts the greenback will strengthen to 124 yen and beyond parity with the euro by the end of the year. The dollar rose 1.2 per cent to 113.24 yen and was up 0.4 per cent at $US1.0659 per euro. The Aussie dollar fell 0.3 per cent to $US76.23¢.Â
"Hot air": Citigroup chief economist Willem Buiter doesn't have much patience for Donald Trump's currency talk. Photo: Wayne Taylor
Trump "probably would do well to look at basic economics of exchange rates," Buiter said.
"You cannot have anticipated fiscal expansion and anticipated monetary tightening while the rest of the world, by and large, is in a monetary loosening mode still and expect your currency to weaken."
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