US Dollar Slides to New 2025 Lows Amid Ongoing Trade Uncertainty

The US dollar continued its downward slide on Monday, falling for a fifth consecutive session as investors remained wary of escalating trade tensions and uncertain policy signals from the Trump administration, Bloomberg reports.

The Bloomberg Dollar Spot Index dropped as much as 0.4% during the session, extending a 2.4% decline from the previous week. This latest retreat pushed the index to its lowest point in 2025 so far—levels not seen since October of the previous year.

Although a weekend announcement from the White House temporarily suspended tariffs on a range of consumer electronics, including smartphones, laptops, and memory chips, the market’s optimism quickly faded. President Donald Trump took to social media early Monday to clarify that the exemption was not a sign of leniency, warning that further duties on technology products remain on the table. He also hinted at a national security review of microchip imports.

“NOBODY is getting ‘off the hook,'” Trump posted.

For currency markets, the message was clear: without a comprehensive and lasting resolution to the trade conflict, the dollar may face continued pressure.

“For the US dollar to rally on a sustained basis, a swift peace settlement of the trade war is needed before long-lasting harm is done on the US economy,” said Dane Cekov, senior macro and currency strategist at Sparebank 1 Markets AS in Oslo. “The US dollar will continue to weaken in the months to come as Trump’s tariffs’ impact appears in hard data such as consumption, inflation and labor market figures.”

Recent market sentiment reflects these concerns. A Bloomberg survey of investors indicated expectations of further reduced exposure to US assets, even after the White House’s temporary easing of tariff enforcement. Volatility in the currency market remains elevated, with dollar fluctuations at their highest level in two years. Speculative positions against the dollar also increased through April 8, according to Commodity Futures Trading Commission data.

Despite the growing unease, some Federal Reserve officials have maintained a cautious tone. Minneapolis Fed President Neel Kashkari said over the weekend that while he expects markets to stay “orderly,” the central bank has limited ability to manage the turbulence caused by trade policy uncertainty. This came after more dovish remarks from his Boston counterpart, who hinted at potential Fed support for markets.

Analysts at JPMorgan Chase & Co. also urged caution.

“We keep a cautious stance in risk assets with expected rangebound dynamic over the short term,” they wrote in a note to clients. “Any technical rebound could be short lived if not supported by clarity on negotiations and by the Fed.”