President Donald Trump may think the Chinese are the "grand champions" of currency manipulation, but he's wrong, expert John Rutledge told CNBC on Friday.

"Trump is an idiot on this. He has no clue what currency manipulation means," the chief investment officer of global investment firm Safanad said in an interview with "Closing Bell."

During the campaign, Trump accused China of keeping its yuan currency artificially low against the U.S. dollar to make Chinese exports cheaper, "stealing" American manufacturing jobs.

On Thursday, the president told Reuters he has not "held back" in his assessment, despite not acting on a pledge to declare the country a currency manipulator on his first day in office.

"Well they, I think they're grand champions at manipulation of currency. So I haven't held back," Trump said. "We'll see what happens."

However, earlier Thursday Treasury Secretary Steve Mnuchin told CNBC he wasn't ready to pass judgment on China's currency practices.

"We have a process within Treasury where we go through and look at currency manipulation across the board. We'll go through that process. We'll do that as we have in the past. We're not making any judgments until we continue that process," he told "Squawk Box."

Rutledge, who was one of the principal architects of President Ronald Reagan's economic plan, said China is actually trying to support its currency.

"Chinese authorities have actually sold a trillion dollars' worth of foreign reserves in the last year to support their currency that's trying to fall because Chinese nationals are trying to get their money out of China," he said. That is anti-manipulation."

—Reuters and CNBC's Steven Desaulniers contributed to this report.

