The US dollar has been on a tumultuous ride, experiencing its worst first half in over 50 years, with a 10.8% decline against a basket of currencies. The escalating trade war initiated by Donald Trump and his perceived interference with the Federal Reserve are weighing heavily on the greenback, diminishing its appeal as a safe-haven asset.
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.