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On Tuesday, the US dollar came under pressure, approaching a three-year low against the euro and remaining near a six-month low against the yen, despite rising Treasury yields, Reuters reports.
- US dollar to euro exchange rate: $1.136
- Dollar to yen exchange rate: ¥142.99
- Dollar index: 99.641 – near a three-year low
Reasons for the fall
Trump’s inconsistent tariff policy – he imposes duties and then cancels them; smartphones and electronics are temporarily excluded from the list of tariffed goods, but not for long.
Volatility in US financial markets – analysts say the dollar and US bonds are losing their safe haven status.
Fed comments – officials hint at a possible rate cut, even though inflation remains high, due to tariff pressure on the economy.
“The volatility in tariffs is undermining confidence in the dollar. Investors are looking for an alternative among more stable currencies,” said Kieran Williams, InTouch Capital Markets.
Other currencies are on the rise
The euro is at a three-year high
Australian dollar – +0.66%.
New Zealand dollar – +0.88%, maximum for 4.5 months
Pound sterling – $1.3215
Investors await the Fed’s decision
Analysts expect up to 86 basis points of rate cuts by the end of the year. After last week’s loud jump in government bond yields, the market has calmed down this week – but confidence in the dollar remains shaky.
