President Donald Trump’s newly-appointed top economic advisor Larry Kudlow believes that good economic policy includes a “sound, stable dollar.”
“A great country needs a strong currency,” Kudlow said on CNBC’s “Closing Bell” Wednesday. “I have no reason to believe [President Trump] doesn’t favor a sound and strong and steady dollar.” I’m not saying the dollar has to go up 30 percent, I’m just saying let the rest of the world know that we are going to keep the world’s international reserve currency steady.”
Kudlow, who was tapped by President Trump to chair the National Economic Council on Tuesday, has previously called for a strong dollar as well as targeted tariffs on Chinese imports. He remains a proponent of free trade more broadly.
“I’m not saying the dollar has to go up 30 percent, I’m just saying let the rest of the world know that we are going to keep the world’s international reserve currency steady,” Kudlow added. “That creates confidence at home.”
While traditionally, administrations have publicly advocated for a strong dollar, comments made by Trump and Treasury Secretary Steven Mnuchin have raised suspicions that this administration feels differently.
Mnuchin in January said dollar weakness is “not a concern of mine” only to backtrack a day later and reiterate that a strong “long-term dollar” is in the country’s best interest. Trump hinted before his inauguration that he preferred a weaker dollar.
The Dollar Index, the greenback versus a basket of currencies, is down 12 percent the last 12 months.