The outlook for the US dollar appears grim, with the currency recording its worst first half in over 50 years, falling 10.8% against a basket of currencies. The ongoing trade war initiated by Donald Trump and mounting concerns over the US national debt are weighing heavily on the greenback, diminishing its appeal as a safe-haven asset.
The pound has surged to a three-year high against the struggling dollar. David Morrison of Trade Nation attributes the dollar’s fall to Trump’s tariffs and the perceived chaos of his administration. Despite the dollar’s struggles, US stock markets have shown remarkable resilience, rebounding to a record high by the end of June. This turnaround, influenced by a temporary pause on tariffs and the “fear of missing out” sentiment, demonstrates the market’s capacity to find optimism even amidst currency weakness.