Global confidence in USD falters amid economic disruption
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Daily Currency Update
US President Donald Trump’s unpredictable economic agenda has sent shockwaves through the FX markets, weakening the US dollar and sparking fresh doubts about its long-held role as the world’s reserve currency. As Washington's political and fiscal uncertainty intensifies, the euro appears increasingly well-positioned to capitalise.With the credibility of U.S. institutions under strain, transatlantic political tensions may finally clear the path for the eurozone to introduce a long-discussed “safe asset” to rival US Treasury bonds. Such a development could dramatically shift the global currency landscape, potentially strengthening the euro’s position in global reserves and increasing FX market volatility in the months ahead.
Key Movers
In contrast to the previous session’s dip, the US dollar jumped this morning following reports that China is considering tariff exemptions on certain US goods, renewing optimism for a potential de-escalation in the intensifying trade war between the world’s two largest economies.Speculation arose around the long-term value of the dollar’s role as the global reserve currency, as some officials questioned its advantages.
Today’s rebound shows just how quickly sentiment in FX markets can shift on geopolitical headlines, with renewed hopes of progress triggering a sharp reversal in dollar positioning. Market participants will be watching closely for any concrete developments from both sides as uncertainty continues to drive volatility across currency pairs.
Expected Ranges
- GBP/USD: 1.3255 - 1.3335 ▲
- GBP/EUR: 1.1675 - 1.1745 ▼
- GBP/AUD: 2.0785 - 2.0865 ▲
- EUR/USD: 1.1315 - 1.1395 ▲