Why Trump's Weak-Dollar Policy Threatens the U.S. Stock Rally
- Tension between trade and greenback policy, say analysts
- Revenue-generating border adjustment tax seen as less likely
Mnuchin Tells FT He Prefers Stronger Dollar 'Over Time'
This article is for subscribers only.
Donald Trump’s support for a weaker dollar has the potential to torpedo a key tax-reform proposal that has served as one of the main catalysts of the U.S. stock market rally.
The so-called border-adjustment tax favored by Republicans in the House of Representatives is basically a charge on imports into the U.S. that was supposed to be partly offset by a stronger greenback. The absence of a stronger dollar to serve as a counterbalance against the likely resulting inflationary pressure from the tariff seems to make the tax a less of a possibility.