Online Reporter
A gauge of the dollar slid toward its lowest level in nearly two years after US President Donald Trump’s decision to postpone higher tariffs on the European Union boosted other currencies with strong links to global trade.
The Bloomberg Dollar Spot Index fell as much as 0,4 percent yesterday and is headed toward a level unseen since July 2023. Currencies including the Australian and New Zealand dollars as well as the euro surged after President Donald Trump said he would extend the deadline for the EU to face 50 percent tariffs until July 9.
The EU tariff delay “has seen sentiment rebound, helping the Australian and New Zealand dollars especially versus the US dollar,” said Felix Ryan, an analyst at Australia and New Zealand Banking Group in Sydney.
The dollar gauge has lost more than 7 percent so far in 2025 and is set to wipe out all of its gains from last year, when the index rose the most since 2015. Investor demand for dollars is fading amid jitters over tariffs and concern over the US government’s finances spurred by plans to extend tax cuts implemented by Trump in his first term.
“While US dollar headwinds are potent, including concern over US fiscal policy and tariffs, positioning on the US dollar is already quite negative against some currencies,” especially versus the yen, Ryan added.
The tariff reprieve for EU bolstered both the Group-of-10 and emerging market currencies yesterday.
The Australian dollar rose to as high as 65,37 US cents while the kiwi dollar jumped to 60,32 US cents, their strongest levels since November. The euro rallied 0,5 percent to its highest level since April.
Taiwan’s dollar gained to the strongest since early May while the Philippine peso briefly reached its highest since 2023.
Futures of Treasury 10-year notes declined by an extent that would imply a rise of more than three basis points in yields. Cash trading of US government bonds is shut globally for a US holiday. — Bloomberg.
