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Dollar Drops 10%, Worst First Half Since 1973 Amid Trump Agenda

14 posts • OpenAI (o3)

Updated Jun 30, 2025, 02:25 PM

The US dollar has recorded its steepest first-half slide in more than half a century, with the ICE Dollar Index dropping over 10% in the six months to June and erasing gains made during Donald Trump’s second term. The sell-off marks the currency’s worst start to a year since 1973, when the post-Bretton Woods era began.

Other gauges confirm the breadth of the retreat: the Bloomberg Dollar Spot Index is down almost 9%, its sharpest first-half fall since the measure was created in 2005, while the WSJ Dollar Index has fallen 8%, the weakest opening six-month stretch since 2002. Investors have cut dollar exposure amid growing doubts about the United States’ fiscal and policy outlook.

Analysts point to a confluence of factors, including the administration’s 145% tariff on Chinese goods, renewed trade skirmishes with allies, and the “One Big Beautiful Bill” tax-and-spending package now before the Senate. The legislation is forecast to swell federal borrowing by roughly $3.2 trillion over a decade and, together with political pressure on the Federal Reserve, has heightened expectations of aggressive interest-rate cuts.

The dollar’s slide has buoyed rival currencies. Sterling has appreciated about 9% so far this year—putting it on course for its strongest first half since 2009 and its biggest quarterly gain in more than two years—helped by optimism over a nascent US-UK trade accord. The euro has climbed roughly 13% to above $1.17, while traditional havens such as gold remain near record highs.

Francesco Pesole of ING warns that foreign investors are increasingly hedging dollar risk, and Pimco’s Andrew Balls says the US unit could weaken further even if its reserve-currency status stays intact. With global funds reallocating away from US assets, strategists expect sustained downward pressure on the greenback, albeit at a slower pace than the first-half rout.

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Mario Nawfal

@MarioNawfal

🇺🇸 DOLLAR TAKES A DIVE: WORST START TO A YEAR SINCE 1973 Trump’s tariff war and trillion-dollar tax plan are spooking global investors. The dollar’s down over 10% in 2025, its sharpest fall since Nixon ditched the gold standard. Wall Street predicted the euro would crash.

Mohamed A. El-Erian

@elerianm

Per the @FT and further to my earlier posts: “The dollar index, which measures the currency’s strength against a basket of six others including the pound, euro and yen, has slumped more than 10 per cent so far in 2025, the worst start to the year since the end of the gold-backed

James Pethokoukis ⏩️⤴️

@JimPethokoukis

1973, by the way, marked a historic downshift in American economic performance US Dollar Suffers Worst Start to Year Since 1973: Donald Trump’s trade policies and rising debt levels have sparked decline of more than 10% in first half of 2025 @FT

*Walter Bloomberg

@DeItaone

DOLLAR ON TRACK FOR WORST FIRST HALF IN DECADES The dollar is heading for its steepest first-half drop in at least 40 years. The ICE Dollar Index is down over 10% in 2025, while the WSJ Dollar Index is down 8%, the worst since 2002. The decline reflects concerns over Trump’s

Financial Times

@FT

Breaking: The US dollar has suffered its worst first half of the year since 1973, as Donald Trump’s trade and economic policies prompt global investors to rethink their exposure to the world’s dominant currency.

#US #ICE Dollar Index #Donald Trump #Bretton Woods #Bloomberg Dollar Spot Index #WSJ Dollar Index #United States #Chinese #Senate #Federal Reserve #Francesco Pesole #ING #Pimco #Andrew Balls

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Sources

ft.com(2)www1.folha.uol.com.br semafor.com tgcom24.mediaset.it

Infobae Economía

@infobaeeconomia

The dollar experienced its worst semiannual decline since 1973

Mario Nawfal

@MarioNawfal

Blog do Noblat

@BlogdoNoblat

The dollar suffers the worst first half since 1973. Trump's trade policies and American debt triggered a drop of more than 10% in the first half of 2025 (FT)