Weak US economic data and falling bond yields have weakened the currency.
The U.S. dollar is at its lowest in three months on fears of an escalation in the trade war that U.S. President Donald Trump has launched against Canada, China and other countries.
Reuters writes about this.
During his testimony before Congress, he announced that new “mirror” tariffs and other measures would be introduced to balance the country's trade balance.
Following these statements, the dollar exchange rate fell sharply: the dollar index against a basket of major currencies fell to 105.46 points, which was the weakest indicator since December 6.
Investors fear that rising tariffs will undermine the outlook for the U.S. economy, which is already showing signs of slowing.
“While tariffs should theoretically help strengthen the dollar, investors are more concerned about the long-term risk of stagflation and a possible deterioration in economic growth,” the journalists write.
Recall that US Defense Secretary Pete Gegset warned that the United States is ready to start a war with China.
Gegseth's threat came after China said Tuesday night it was prepared to fight back if the US was intent on starting a trade or tariff war – shortly after Trump's initial 10 percent tariff on Chinese imports was doubled to 20 percent.
“If the US wants war, whether it is a tariff war, a trade war or any other type of war, we are ready to fight to the end,” said Chinese Foreign Ministry spokesman Lin Jian.
China quickly responded to the new tariffs, announcing an increase in import duties on a range of US agricultural and food products by 10-15%.
In addition, 25 American companies were subject to export and investment restrictions on national security grounds.
Read also :
- Trade World War: And This Is Just the Beginning – What Trump Is Achieving and Who Are the Next Victims
- Trump signed an executive order imposing 25 percent tariffs on imported steel and aluminum.
- EU ready to respond to US tariffs on its goods – European Commission representative