(Bloomberg) -- The European Central Bank's role is to maintain price stability, not to set foreign-exchange levels, according to Governing Council member Francois Villeroy de Galhau, rebuffing accusations by U.S. President Donald Trump that the region is manipulating the euro for trade benefits.
“Price stability is the first promise that central banks must fulfill,” Villeroy said at an economics conference on Saturday in Aix-en-Provence, southern France. “Our goal for the euro zone is inflation close to 2 percent in the mid-term. I do say a goal of price stability and not a goal of forex. Certain tweets seem to consider that it's a forex issue but it's not, the promise is to stabilize prices.”
In a tweet last week, Trump accused Europe and China of currency manipulation to compete with the U.S. He wants a weaker dollar to help boost exports, pushing the Federal Reserve to help make that happen. But, like Villeroy of France, the U.S. central bank's chairman, Jerome Powell, has made clear it's not his job.
Trump's focus on the dollar surfaced after the European Central Bank said it might ease policy, prompting the euro to drop against the dollar. Trump seized on the move to say on June 18 that the Fed's failure to lower rates was putting U.S. exporters at a competitive disadvantage. He later mused on June 26 that he'd rather have ECB President Mario Draghi running the Fed.
Trump has accused both Europe and China of weakening their currencies to gain a competitive advantage.
Related: Trump Drags Dollar Front-and-Center Before Xi Meeting at G-20
To contact the reporter on this story: Angeline Benoit in Paris at abenoit4@bloomberg.net
To contact the editors responsible for this story: Anthony Palazzo at apalazzo@bloomberg.net, Tara Patel, James Amott
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