U.S. Dollar Falls 10 Percent in First Half of 2025
(MENAFN) The US dollar has experienced a dramatic drop of over 10% against major global currencies in the first half of 2025, marking its most significant decline to begin a year since 1973, according to media. This slump is largely attributed to President Donald Trump’s trade policies and mounting fears over rising fiscal deficits.
As of now, the ICE US Dollar Index, which tracks the currency’s performance against a group of key currencies, has decreased by 10.8% year-to-date. This shift marks a sharp contrast to the dollar's usual role as a stable "safe-haven" asset, the report highlights.
The last time the dollar experienced a comparable decline at the start of the year was in 1973, following the US’s decoupling from the gold standard. This time, the dollar’s plunge is largely linked to Trump’s aggressive trade policies aimed at reshaping the global economic order through tariffs and a more protectionist stance, the report explained.
Since resuming office in January, Trump has introduced sweeping tariffs to safeguard US manufacturing. The policy reached its apex on April 2 with “Liberation Day” measures, which included a blanket 10% tax on all imports and harsher tariffs on goods from China, Mexico, Canada, and the European Union.
While some of these tariffs have been temporarily suspended to allow for negotiations, Trump has defended the strategy as essential for bringing jobs back to the US and reducing the nation’s trade deficit.
However, these policies have unsettled financial markets, according to media. Concerns about inflation, rising government debt, and Trump’s contentious trade proposals have pressured the dollar, while waning trust in the US’s global economic leadership further exacerbates the decline.
“Having a weak dollar or a strong dollar isn’t the issue,” said Steve Englander, global head of G10 foreign exchange research at Standard Chartered, speaking to media. “The issue is: What is it telling you about how the world sees your policies?”
Analysts have warned that the dollar’s ongoing fall could have far-reaching global consequences. Some market experts are now questioning the dollar’s long-standing status as the world’s dominant reserve currency.
To compound investor anxiety, the Senate recently passed a Republican-backed tax-and-spending bill that is projected to increase the federal deficit by a staggering $3.3 trillion.
Legal Disclaimer:
EIN Presswire provides this news content "as is" without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the author above.
