Treasury nominee Janet Yellen to say U.S. does not seek weaker dollar:
WSJ
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[January 18, 2021] (Reuters)
- Janet Yellen, President-elect Joe Biden's
pick to take over the U.S. Treasury, is expected to affirm the United
States' commitment to market-set currency rates when she testifies on
Capitol Hill on Tuesday, the Wall Street Journal reported.
The Treasury secretary nominee will make clear at a Senate confirmation
hearing that the United States does not seek a weaker dollar, the
newspaper reported https://on.wsj.com/35NaV8W on Sunday, citing Biden
transition officials familiar with her preparation.
"The value of the U.S. dollar and other currencies should be determined
by markets. Markets adjust to reflect variations in economic performance
and generally facilitate adjustments in the global economy," Yellen will
say according to the report, if asked about the incoming
administration's dollar policy.
"The United States doesn't seek a weaker currency to gain competitive
advantage," she is prepared to say, according to the WSJ. "We should
oppose attempts by other countries to do so."
A Biden transition team official did not respond to a request for
comment about Yellen's testimony. Biden, a Democrat, takes office on
Wednesday.
The policy outlined by Yellen would be a return to a traditional posture
after Republican President Donald Trump railed against the dollar's
strength for years, saying it gave other countries a competitive
advantage.
It also comes with investors heavily short dollars - with the value of
bets against the greenback the highest in almost a decade - partly in
anticipation of U.S. trade and budget deficits widening further under
the new administration.
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Janet Yellen, U.S. President-elect Joe Biden's nominee to be
treasury secretary, takes to the podium to speak as President-elect
Biden announces nominees and appointees to serve on his economic
policy team at his transition headquarters in Wilmington, Delaware,
U.S., December 1, 2020. REUTERS/Leah Millis
"(Yellen) is kind of signaling a hands-off approach, which is reverting to what
had traditionally been the case before Trump," said Bank of Singapore analyst
Moh Siong Sim, who figures the dollar could continue to decline.
"I think the dollar and financial markets will be less of a focus, in terms of
verbal rhetoric, for the Treasury secretary and the key focus will be getting
policy implemented in terms of fiscal relief."
The dollar has bounced in recent weeks but suffered its worst annual loss since
2017 last year. Yellen, who served as head of the U.S. Federal Reserve from 2014
to 2018, is expected to win confirmation in the Senate and will likely be one of
the first Biden Cabinet picks to be confirmed.
(Reporting by Kanishka Singh in Bengaluru and Trevor Hunnicutt in Wilmington,
Delaware; Additional reporting by Ira Iosebashvili and Tom Westbrook ; Editing
by Nick Zieminski, Peter Cooney and Gerry Doyle)
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