Bloomberg
“Trump Blasts Fed Rate Hikes, Says Strong Dollar Hurts U.S.”
President Donald Trump lashed out at China and the European Union for their weak currencies and said a stronger dollar and rising interest rates are undermining America’s “competitive edge,” taking a fresh jab at the Federal Reserve. Stocks and the dollar fell.
“China, the European Union and others have been manipulating their currencies and interest rates lower, while the U.S. is raising rates while the dollars gets stronger and stronger with each passing day — taking away our big competitive edge,» Trump tweeted early Friday. “The United States should not be penalized because we are doing so well.”
In an apparent reference to Fed rate increases, Trump added, “Tightening now hurts all that we have done. Debt coming due & we are raising rates — Really?”
Trump’s comments mark the latest twist in an escalating trade war with countries the president accuses of trading unfairly, raising the prospect that the conflict could also morph into a currency spat. Until now, Trump has mostly focused on using tariffs as leverage to try to convince China and other nations to open up their markets.
Trump is breaking with decades of tradition that presidents avoid commenting directly on the dollar or the path of U.S. monetary policy. The latter is usually seen as the domain of the Fed, while the U.S. Treasury secretary is typically the chief spokesman on the dollar. For years, the U.S. has hewed to the idea that a strong dollar is good for the U.S. economy.
Trump’s comments that China and the EU are manipulating currencies contradict a Treasury Department semi-annual report released in April that refrained from naming any country a currency manipulator based on specific criteria.
Reuters
“At Texas border, joy and chaos as U.S. reunites migrant families.”
Luis Campos, a Dallas attorney, showed up at a Texas immigrant detention facility close to the U.S.-Mexico border on Wednesday morning expecting to represent a client before an immigration judge.
Lawyers and immigrant advocates working in south Texas this week reported widespread disarray as the federal government scrambled to meet a court-imposed deadline of July 26 for reunifying families separated by immigration officials under the Trump administration’s “zero tolerance” measures. Half a dozen lawyers Reuters spoke to described struggles to learn of reunification plans in advance and difficulty tracking down clients who were suddenly released or transferred to family detention centers run by Immigration and Customs Enforcement (ICE).
The lawyers said it was often difficult to get through by telephone and that when they did the government employees often knew little about their clients’ status or location.
ICE officials did not respond to questions about the reunification process in Texas and elsewhere.
A government court filing on Thursday said that 364 reunifications had taken place so far. It was unclear from the document, filed as part of an American Civil Liberties Union lawsuit challenging parent-child separations at the border, exactly how many more were likely.
Of more than 2,500 parents identified as potentially eligible to be reunited with their children, 848 have been interviewed and cleared for reunification, government attorneys told the court. Another 91 have been deemed ineligible because of criminal records or for other reasons.
BBC News
“Farnborough Airshow: A380’s ‘best years still to come’.”
The head of Airbus’ aircraft operations has mounted a strong defence of the troubled A380 super-jumbo jet, claiming its «best years are ahead of us». Tom Williams insisted the A380’s absence from the Farnborough Airshow had nothing to do with falling sales.
It’s the first time in more than a decade that the flagship aircraft has been absent from the global showcase. Mr Williams, who also warned about a possible trade war, told the BBC Airbus decided to display its latest products.
An Emirates Airline order for A380s earlier this year has helped bolster the programme, but speculation about its future won’t go away. The European aircraft manufacturer, whose wings are made in the UK, has become dependent on the Dubai-based airline to keep A380 production alive.
Mr Williams, chief operating officer for Airbus Commercial Aircraft, rejected suggestions that selling the A380 was just too hard. «We are bringing the newest products [to Farnborough] to show them off, and there is a limit to how many aircraft we can bring.
The A380 debut was in 2005 at the Paris Airshow, and it showcased at Farnborough the following year. But one of the costliest aircraft projects ever undertaken has been battling for customers ever since the first plane was delivered to Singapore Airlines in 2007.
Production has been cut several times as airlines shunned the plane due to high operating costs and competition from more efficient, but smaller, rival aircraft. Airbus is expected to make just eight A380s next year.
Bloomberg
“Stocks Rise as Focus Shifts Back to Earnings: Markets Wrap.”
Stocks erased early losses and push higher as investors focused on positive earnings results from companies ranging from Microsoft to Honeywell and downplayed the latest verbal salvos from President Donald Trump in an escalating trade war.
The dollar slumped by the most since May after Trump said he’s “ready to go” with additional import tariffs and that China, the European Union and others have been manipulating their currencies and interest rates. Yields on Treasuries were mostly higher as Trump doubled down on comments that he’s unhappy with the Federal Reserve tightening after the administration has worked so hard to grow the economy.
“If you step back and look at how strong the market’s been, in my mind it’s all earnings driven,” said Gary Bradshaw, senior vice president of First Dallas Securities. “You look at earnings that have come out and they’ve been great, Microsoft last night as an example.”
Trump’s latest move in the trade war with China came as investors try to gauge the ability of the Asian nation’s economy — the world’s second-biggest — to withstand a protectionist showdown. The yuan may be a key tool in China’s response to Trump, who continues to y express dissatisfaction with America’s own monetary policy as his country’s currency strengthens.
Elsewhere, WTI crude nudged higher, while most base metals also advanced. Emerging market equities climbed.