Backing away from a campaign pledge, President Donald Trump said Wednesday that his administration won’t label China a currency manipulator in a report due this week, though he does think the U.S. dollar “is getting too strong.”

Trump also said in an interview at the White House with The Wall Street Journal that he would prefer that the Federal Reserve keep interest rates relatively low.

The president also left open the possibility of re-nominating Janet Yellen for a second four-year term as Fed chair. That would mark another shift from his campaign position that he would likely replace Yellen when her term as chair ends in February next year.

In the interview, Trump said, “I do like a low-interest rate policy, I must be honest with you.”

The decision not to label China a currency manipulator represents one of the sharpest reversals of Trump’s brief presidency. Trump began to bash China in the 2015 speech that began his campaign, saying Beijing kept its currency artificially low to give its manufacturers an unfair advantage in global trade.

A weaker Chinese currency, relative to the dollar for example, makes Chinese goods more affordable for American consumers and U.S. goods more expensive in China.

“China is killing us,” Trump had complained on the campaign trail. “They’re devaluing their currency to a level that you wouldn’t believe. It makes it impossible for our companies to compete.”

As a candidate, Trump pledged to instruct his Treasury secretary to label China a currency manipulator immediately after he took office.

But in Wednesday’s published interview with the Journal, Trump said he had changed his mind because he now believes that China hasn’t been manipulating its currency for months and because labeling Beijing a manipulator might jeopardize his talks with the Chinese on confronting the threat of North Korea.

“They’re not currency manipulators,” Trump said.

On the dollar’s overall value against major trading partners, Trump said: “I think our dollar is getting too strong, and partially that’s my fault because people have confidence in me. But that’s hurting — that will hurt ultimately.”

“It’s very, very hard to compete when you have a strong dollar and other countries are devaluing their currency,” the president said.

The dollar began rising in value in mid-2014, a trend that has exerted a drag on U.S. exports.

Trump was highly critical of Yellen during the fall campaign, accusing her of keeping borrowing rates low to help Democrats.

But asked during the Journal interview whether Yellen would be “toast” when her term ends next year, Trump said, No. not toast.”

“I like here, I respect her,” Trump said, noting that the two have met since he took office for an Oval Office discussion.

Treasury Secretary Steven Mnuchin, who sat in on part of the Journal interview, said Trump was “very close” to nominating a Fed vice chairman to oversee bank supervision and filling another seat that will go to a community banker.

“We think it is very important,” to have a community banker on the Fed board, Mnuchin said.

With the departure last week of Daniel Tarullo, a Fed board member, Trump now has the chance to fill three of the seven seats of the board. Two seats have been vacant for over a year because the Republican-led Senate had refused to take up the two nominees during Barack Obama’s presidency.

(AP)