US Dollar: A Contrarian Perspective on How Trump 2.0 Could Weaken the Greenback

Forex Analysis by Matthew Weller covering: US Dollar Index Futures. Read Matthew Weller's latest article on Investing.com

through a combination of protectionist policies, tariffs, and strong economic growth, and at first glance, those dynamics paint a compelling bullish picture for the greenback.

For instance, in his Truth Social post threatening 25% tariffs on Canada and Mexico, he noted that the tariff would remain in effect only until those countries limited the flow of drugs and immigrants into the US. In other words,, not necessarily as part of a “tariff first, ask questions later” approach the characterized the 2016-2020 period.

For financial markets, the Treasury Secretary’s stance on the dollar often sets the tone for currency policy. If Bessent signals openness to a weaker dollar, it could spark market realignments across forex pairs.Trump’s contentious relationship with the Federal Reserve could take center stage during a second term.

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