The US Dollar Index has experienced a decline of more than 8% since the beginning of the year, marking its lowest point in roughly three years. This depreciation is underpinned by uncertainties related to President Trumpâs tariffs and fears of an impending recession. Analysts from Deutsche Bank and Goldman Sachs warn of a prolonged dollar weakness impacting consumer prices as tariffs take effect. Furthermore, trade war dynamics risk diminishing the global reputation of the US dollar, illustrating a shift in global currency reliance.
The dollar bear market is finally here, driven by reduced global funding for US deficits and increased domestic fiscal support outside the US.
The recent dollar depreciation has considerably further to go, reinforcing how higher tariffs impact American consumers more than foreign producers.
America has become 20% poorer in four weeks due to the dollar's slide against the euro, jeopardizing the country's brand amid the trade war.
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