U.S. Treasury Secretary Steven Mnuchin on Wednesday praised the strong dollar as a reflection of confidence in the U.S. economy, telling The Wall Street Journal in an interview that it was "a good thing" in the long run.
Echoing comments he made last month during his Senate confirmation hearing, Mnuchin said the dollar's strength reflected the United States' stronger economic performance compared with the rest of the world and the greenback's status as a reserve currency.
He told the Journal that the dollar's value was "a reflection of the confidence that kind of people have in the U.S. economy."
President Donald Trump said before his inauguration in January that the dollar's strength against the Chinese yuan was "killing us" and making it hard for U.S. companies to compete, roiling global currency markets.
The Treasury secretary is the traditional dollar spokesman in U.S. administrations, and Mnuchin's comments are more in line with his predecessors' mantra that a strong dollar is good for the United States even if it can hurt exports. But Mnuchin repeated his caveat that at times short-term dollar spikes are not always positive.
"For longer-term purposes, an appreciation of the dollar is a good thing, and I would expect longer-term, as you’ve seen over periods of time, the dollar does appreciate," Mnuchin told the Journal.
"In the short term, there are certain aspects (of a strong currency) that are positive about the dollar for our economy and there are certain aspects that are not as positive," Mnuchin added. "A lot of the appreciation of the dollar since the election in particular is a sign of confidence in the Trump administration and the economic outlook for the next four years."
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