The US dollar continued to weaken on Monday on uncertainty over President Trump's tariff policy, while the Japanese yen and euro strengthened as investors increasingly lost confidence in US assets and currencies. The US dollar index fell to 99.4, near a three-year low, after Trump imposed and then suspended tariffs on imported goods.
Analysts said the market was being driven by uncertainty, with investors turning to currencies such as the euro and Swiss franc for protection. The pound sterling and Australian dollar also strengthened, while the Japanese yen was near a six-month high against the dollar.
Trump said tariffs on semiconductor chips would be announced this week, giving some companies some relief. However, inconsistent policies from the White House have caused confusion and further undermined international investor confidence in the US market.
Japan, meanwhile, is preparing for trade talks with the US that are expected to touch on currency policy. Some officials expect Washington to pressure Tokyo to allow the yen to strengthen. Markets are starting to react to the expectations, although there is no official decision yet.
Meanwhile, the Chinese yuan continued to weaken to its lowest level since 2007, amid rising trade tensions. At the same time, Chinese exports surged as companies sought to speed up shipments before new US tariffs took effect.
