The European Trade Wars Begin: Trump Trade Advisor Accuses Germany Of Using “Grossly Undervalued” Euro

Tuesday, January 31, 2017
By Paul Martin

by Tyler Durden
ZeroHedge.com
Jan 31, 2017

The Trump administration just fired the first shot in the US-European currency, and thus trade, wars when Trump’s top trade advisor Peter Navarro accused Germany of using a “grossly undervalued” euro to “exploit the US and its EU partners”, the FT reported noting the comments are “likely to trigger alarm in Europe’s largest economy.” News of the statement sent the EURUSD surging and the dollar tumbling to fresh 2 month lows.

Navarro, the head of Mr Trump’s new National Trade Council, told the Financial Times the euro was like an “implicit Deutsche Mark” whose low valuation gave Germany an advantage over its main partners. While not necessarily novel – Germany has often been accused of being the biggest winner from a weak euro at the expense of peripherla Europe – his views suggest the new administration is focusing on currency as part of its hard-charging approach on trade ties, according to the FT. Furthermore, virtually assuring a deterioration in US-German relation, and in a departure from past US policy, Navarro also called Germany one of the main hurdles to a US trade deal with the EU and declared talks with the bloc over a Transatlantic Trade and Investment Partnership dead.

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