19.01.202602:12:27UTC+00Dollar Falls on Trump Tariff Threat

On Monday, the dollar index decreased, moving closer to 99, stepping back from its recent multi-week highs as it weakened primarily against the yen and the Swiss franc, both seen as safe-haven currencies. This shift occurred after President Donald Trump issued a threat to impose new tariffs on eight European countries in an effort to gain control of Greenland. The nations at risk—Germany, the UK, France, Denmark, Norway, Sweden, the Netherlands, and Finland—could face an initial 10% tariff starting February 1, which may escalate to 25% by June unless an agreement is reached. European leaders have convened to discuss potential retaliatory actions, which could include reviving a previous strategy to levy tariffs on American products. French President Emmanuel Macron reportedly encouraged his colleagues to implement the EU’s anti-coercion tool. Initially, the dollar strengthened against both the euro and the pound but then reversed course abruptly as investors considered the possible implications of Trump’s decisions on the United States' economy.