Synopsis
On April 14, the US dollar declined by 0.7%, marking its fifth consecutive day of loss. The DXY index reached a three-year low as investors grew concerned about the US economy amidst escalating tariff tensions.Key Takeaways
- US dollar fell 0.7% on Monday.
- DXY index at a three-year low.
- Investors pulling out of US assets.
- Tariffs on Chinese goods increased to 145%.
- Rupee gained 0.75% against the dollar.
New Delhi, April 14 (NationPress) The US dollar has seen a decline of 0.7 percent on Monday, marking its fifth consecutive day of dropping values. This decline has pushed the DXY index, which evaluates the dollar's strength against a selection of major currencies, down to its lowest point in three years.
Since the beginning of April, following US President Donald Trump's declaration of 'Liberation Day' alongside his bold tariff policies, the dollar index has decreased by more than four percent.
This downturn is attributed to investors beginning to lose faith in the resilience of the US economy, prompting them to withdraw their investments from American assets.
Last week, President Trump addressed these apprehensions by asserting that the US dollar would perpetually be regarded as 'the currency of choice.'
He further claimed that should any nation attempt to shift away from utilizing the dollar, a single phone call would suffice to bring them back.
Despite his assurances, market reactions have exhibited growing anxiety.
While analysts maintain that a definitive alternative to the dollar as a global reserve currency is yet to emerge, the recent fluctuations regarding tariffs have sparked uncertainty.
Just last week, the US escalated tariffs on Chinese products to a cumulative 145 percent. In retaliation, China increased its tariffs on American imports from 84 percent to 125 percent.
Experts have remarked, 'This trade battle has ignited a global selloff in markets.' Even traditionally secure investments, such as US Treasuries, have suffered.
The yield on 10-year US Treasury bonds is on track for its most significant weekly rise since 2001, indicating that investors are seeking greater returns due to the perceived risks.
In contrast, the rupee experienced its largest single-day increase in over two years last Friday, climbing 0.75 percent as a weakened dollar and declining crude oil prices enhanced market sentiment.
The Indian currency concluded at 86.05 against the dollar, a notable improvement from the previous day's close of 86.70.
This rebound occurred as investor concerns regarding the US economy intensified, contributing to a broader decline in the dollar's strength.
