14/04/2025 Daily Reports
- The US dollar weakened for a fifth consecutive day as the Bloomberg Dollar Spot Index slid 0.2% and hit its weakest since October.
- Market optimism vanished after President Donald Trump downplayed a temporary exception on electronic tariffs, insisting major tech items like phones and computers would still be targeted.
- The dollar has weakened by nearly 6% so far this year as trade tensions escalate, policy uncertainty, and increasing concerns over a US slowdown continue to pull it down.
- JPMorgan, Goldman Sachs, and Mizuho strategists warned that Trump’s tariffs might undermine consumer confidence, reduce corporate margins, and endanger the dollar’s years-long dominance.
- Fed officials such as Neel Kashkari signaled little desire to intervene.
- At the same time, demand for insurance against a weakening dollar reached its five-year high, indicating growing expectations for further drops except in the case of sharp easing of trade tensions.
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Dollar Drops to New Lows as Tariff Uncertainty Fuels Global Market Shifts
Dollar Extends Its Slide for the Fifth Straight Day
The US dollar continues to decline as market participants grow wary of President Trump’s shifting trade stance. Despite a brief reprieve for certain electronics, Trump downplayed it, reaffirming tariffs on phones, computers, and other consumer tech—rattling investors once again.
Bloomberg Dollar Index Hits New Low
The index fell another 0.4% on Monday, bringing last week’s drop to 2.4%. The dollar has now weakened almost 6% year-to-date, hitting levels not seen since October.
“Nobody is getting off the hook,” says Trump
In a weekend post, Trump clarified that no sectors were truly exempt, calling the earlier reprieve a procedural step. His aggressive tone reignited fears that the trade war could deepen further.
Strategists Say: No Dollar Recovery Without Trade Peace
According to analysts like Dane Cekov from Sparebank 1 Markets, the dollar cannot sustain any meaningful rally without a resolution to the tariff battle. Economic data like consumption, inflation, and jobs will soon reflect the pressure.
Market Sentiment Turns Sharply Bearish
A Bloomberg survey shows nearly 80% of respondents now expect the dollar to fall further in the next month—the most bearish outlook since 2022.
Mixed Messages from the Fed
Minneapolis Fed President Neel Kashkari dismissed speculation that the central bank would step in to support markets. His comments came after Boston Fed’s Susan Collins hinted otherwise, adding to policy confusion.
Big Banks Expect More Dollar Weakness
Analysts from JPMorgan, Goldman Sachs, and Mizuho see further downside for the dollar, especially against the euro and yen. Mizuho expects a potential 5% drop on a trade-weighted basis before any meaningful recovery.
Demand for Dollar Hedges at Five-Year High
Risk reversals on dollar options show soaring demand for protection against further declines. Volatility indicators are reaching levels last seen at the height of the pandemic in March 2020.
What’s Next?
The dollar isn’t just falling because of tariffs—it’s falling because trust is eroding. Mixed Fed signals, inconsistent trade policy, and rising geopolitical risk are pushing investors to rethink the dollar’s role as a safe haven. We may be witnessing the early signs of a deeper structural shift in the global financial system.
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