The U.S. dollar on Wednesday took a hit in currency markets, then rebounded, after President Donald Trump said in a tweet that the U.S. should match China's and Europe's "currency manipulation game."
"China and Europe playing big currency manipulation game and pumping money into their system in order to compete with USA," Trump said on Twitter. "We should MATCH, or continue being the dummies who sit back and politely watch as other countries continue to play their games - as they have for many years!"
The Bloomberg Dollar Index, a basket of the greenback versus other major currencies, dropped following Trump's tweet before recovering. The index recently stood at 96.797.
The Treasury Department in May said that no country met its criteria to be formally labelled as a currency manipulator, though it listed nine countries -- among them China, Germany, Ireland, Italy and Japan -- as being on its monitoring list.
Trump has been vocal in his disdain for so-called quantitative easing and other policy measures that have kept both interest rates and currencies respectively lower than the U.S. dollar, in particular in China and Europe.
By the same token, analysts and market watchers have also speculated that Trump may be intentionally messaging that not only other central banks but the Federal Reserve as well should be lowering interest rates, as a way to push down the dollar.
A cheaper dollar makes American goods abroad less expensive, stimulating the economy in the process.