Trump’s Tariff Threats Boost Demand for the Dollar as a Safe Haven
Global markets faced renewed uncertainty last week amid escalating trade tensions, following fresh threats of additional tariffs from the United States. The growing risk environment drove increased demand for the U.S. dollar, reinforcing its position as a preferred safe-haven asset.
The Bloomberg Dollar Spot Index climbed 0.73% over the week, marking its strongest performance since late February, after two consecutive weeks of decline.
Meanwhile, the Japanese yen and the British pound ranked among the weakest performers within the G10 currencies, highlighting the shift toward dollar-denominated assets during periods of global economic volatility.
The dollar also gained ground on Friday amid rising signs of disruption in the international trade landscape. Market sentiment reflected expectations of a potential imposition of uniform tariffs ranging from 15% to 20% on a broad range of trading partners.
The Canadian dollar was among the biggest losers, sliding over 0.5% to 1.3726 against the greenback. The move followed the introduction of a 35% tariff on imports from Canada, with implementation set for August 1st. The decision is expected to place further pressure on Canadian trade flows and economic stability.
