Greenback’s Perilous Path: Worst First Half in Decades as Policies Unfold

The US dollar is on a perilous path, recording its worst first half-year performance in decades, with a 10.8% drop against a basket of currencies. This decline, the most significant since 1973, is a direct consequence of the unfolding economic policies of Donald Trump, including his tariffs and the anticipated increase in national debt.
The pound has capitalized on the dollar’s vulnerability, soaring to a three-year high. Carsten Brzeski of ING Research described the first six months as “action-packed,” marked by tariffs, market volatility, and questions about Fed independence. While the dollar struggled, US stock markets, after an initial downturn triggered by “Liberation Day” tariffs, staged a historic rebound, pushing the S&P 500 to a record high by June’s end, demonstrating a dynamic and adaptable market.