The US dollar’s woes continue, with a 10.8% decline against a basket of currencies in the first half of 2025, reaching a historic low. The ongoing trade war initiated by Donald Trump and mounting fiscal uncertainty are leading to a significant sell-off of dollar-denominated assets, as the currency’s appeal as a safe haven diminishes.
The pound has surged to a three-year high of $1.37 against the weakened dollar. Carsten Brzeski of ING Research described the first six months as “action-packed,” with tariffs, market volatility, and questions about Fed independence. Despite the dollar’s struggles, US stock markets, after an early April global sell-off, rebounded strongly, with the S&P 500 reaching a record high by the end of June, demonstrating market resilience and adaptability to policy shifts.