The US dollar is exceptionally weak, recording its worst half-year performance since 1973 – since the beginning of 2025, it has already lost about 10% of its value against major currencies. The main reasons for this weakness are Donald Trump's unpredictable economic and trade policies, growing concerns about the increase in US public debt, and increasing pressure on the Federal Reserve to quickly lower interest rates. Investors are increasingly assuming that the Fed will begin to ease monetary policy as early as September, which further weakens the attractiveness of the dollar, and that rates will fall by a total of 75 basis points by the end of the year (70.36% chance as priced by the swap market).
Start investing today or test a free demo
Create account Try a demo Download mobile app Download mobile appSource: CME FED
As a result, the euro strengthened against the dollar by almost 14% in the first half of the year, and the dollar also lost ground against other major currencies such as the Swiss franc and the yen.
Such a sharp decline in the value of the dollar reflects a profound loss of investor confidence in US economic policy.
The Japanese yen is benefiting from the collapse of the dollar, and the Japanese currency is additionally supported today by higher Tankan data for industry, which indicate that activity in the industrial sector is higher than expected (13 points vs. the expected 10 points).
The USDJPY pair is extending its long-term upward trend today and is moving towards multiple lows near 142.035, which are an important support barrier. The pair is losing nearly 0.8% today.
Source: xStation
The material on this page does not constitute as financial advice and does not take into account your level of understanding, investment objectives, financial situation or any other particular needs.
All the information provided, including opinions, market research, mathematical results and technical analyses published on the website or transmitted to you by other means is provided for information purposes only and should in no event be interpreted as an offer of, or solicitation for, a transaction in any financial instrument, nor should the information provided be construed as advice of legal or fiscal nature.
Any investment decisions you make shall be based exclusively on your level of understanding, investment objectives, financial situation or any other particular needs. Any decision to act on information published on the website or transmitted to you by other means is entirely at your own risk. You are solely responsible for such decisions.
If you are in doubt or are not sure that you understand a particular product, instrument, service, or transaction, you should seek professional or legal advice before trading.
Investing in OTC Derivatives carries a high degree of risk, as they are leveraged based products and often small movements in the market could lead to much larger movements in the value of your investment and this could work against you or for you. Please ensure that you fully understand the risks involved, taking into account your investments objectives and level of experience, before trading, and if necessary, seek independent advice.
