WALL STREET: US indexes finished mostly lower.
"Chinese authorities have been responding to Mr. Trump's threat of tariffs (by) continuously devaluing the yuan, a policy move that has the impact of making exports into China more expensive", said Boris Schlossberg, managing director at BK Asset Management. He said the Fed's course of tightening monetary policy now "hurts all that we have done".
AUTO TARIFFS REJECTED: The US Commerce Department sought feedback on President Donald Trump's plans to consider taxing auto imports on Thursday.
He again said he was willing to ramp up his attacks on China, potentially imposing punitive tariffs on all of the $505.6 billion in goods imported from that nation.
"I'm ready to go 500", the Republican leader told the U.S. network CNBC, referring to the $505.5 billion in Chinese imports accepted into the United States in 2017.
On Twitter, Trump also accused China and the European Union of manipulating their currencies to promote their exports at the expense of the USA, and criticized the Fed for raising interest rates.
Brookings Institution Fellow Joseph Parilla said governors don't decide USA trade policy but can engage in direct economic diplomacy to encourage investment, while funding things like education and research at home.
The US has since threatened tariffs on another US$200 billion in Chinese exports, prompting Beijing to vow retaliation.
The tweet marked the announcement that the United States would impose tariffs on steel and aluminum imports coming into the country - and the start of a growing trade war.
Also yesterday, Trump took to Twitter to drag the Federal Reserve into the trade brawl, assailing the US central bank for its apparent reluctance to goose USA exports with a weaker dollar.
Ultimately, the trade war with China could end up being a major losing endeavour for the U.S., assuming that Trump isn't merely bluffing in order to facilitate further discussions on what he would consider an amicable trade agreement. May retail sales saw a rise of 2%, well above expectations of a 1% rise while June inflation jumped from 2.2% to 2.5%, raising the prospect that we might see another rate rise from the Bank of Canada by year end? "I guess that has taken people a bit by surprise", he said. He likewise also took aim at the dollar, saying a higher value "puts us at a disadvantage" and adding that the Chinese yuan "has been dropping like a rock".
He estimated that currency imbalances were costing the USA $150 billion with European Union nations.
But Trump's comments did not do much to push the dollar down versus the yuan, however.
The yuan weakened nearly 1% against the United States dollar on Thursday to hit its lowest level in a year.
Despite Trump's claim, the yuan has been rising steadily if gradually in recent years, as most economists and officials say Beijing actually has been intervening in currency markets to keep the currency from weakening. In this sense, Trump has actually expanded rather than limited China's options in fighting a trade war with Washington.
The Canadian dollar had a great day, jumping almost a full cent to 76.17 cents (U.S.), thanks to the pullback in the USA dollar and a hotter-than-expected reading in US inflation.
"Trump has been clearly bothered by this tactic and yesterday's comments reflected his frustration at losing the battle in the trade war".