According to information presented by The Washington Post, the unstable approach of US President Donald Trump to domestic and foreign policy continues to negatively impact the dollar's exchange rate.
Since Trump's return to the White House in January 2025, the American currency has lost more than 10 percent of its value, according to the publication. Economist Robin Brooks, a senior fellow at the Brookings Institution, expects further weakening of the dollar.
“I believe that this year the dollar could fall by another 10 percent,” he stated.
Brooks also noted that investors are experiencing an “instinctive aversion” to political chaos. He previously worked at the International Monetary Fund.
As reported by The Washington Post, several factors are putting pressure on the dollar. After a prolonged period during which US financial markets grew faster, many foreign investors began to reassess their portfolios, reducing their dependence on the American economy and turning their attention to other countries.
Additionally, the increasing national debt and persistent budget deficits remain additional negative factors, despite the low unemployment rate.
However, according to the publication, the main factor behind the dollar's weakening is the "ripple effect" of the inconsistent policies of the Trump administration. This is related to abrupt decisions and equally sudden changes regarding import tariffs and the use of military force against various countries. As a result, many investors have found themselves under the pressure of constant uncertainty.
One of the indirect indicators of declining confidence in the dollar is the sharp rise in gold prices, which have increased by almost 80 percent over the past year.
