The Editor’s Digest is now accessible at no cost.

The US dollar experienced a significant decline on Tuesday afternoon, following comments from Donald Trump expressing indifference toward the recent sharp downturns.

Against a collection of prominent global currencies, the dollar dropped by 1.3 percent, marking its lowest value in four years, and reflecting a 2.6 percent decrease since the beginning of 2026. Earlier in the day, concerns over the US president’s unpredictable policy decisions had already cast doubts on international investors’ trust in American financial assets.

This development led to sterling and the euro reaching notable highs against the dollar. The euro appreciated by 1.4 percent to $1.204, while sterling climbed 1.2 percent to $1.384, with both currencies achieving their strongest positions since the latter part of 2021.

These additional declines in the dollar’s value came after Trump, at an Iowa event, was questioned about his stance on the currency’s recent performance. He replied, “No, I think it’s great.”

Trump further remarked, “Look at the value of the dollar. Look at the business we are doing. The dollar is, the dollar is doing great.”

A shift into haven assets also accelerated on Tuesday. Silver prices surged more than 8 per cent to $112 per ounce, while gold rose 3.5 per cent to $5,185 per troy ounce. Bitcoin gained 1 per cent to just above $89,000.

“Gold strength and dollar weakness reflect serious doubts over chaotic, off-the-cuff policymaking by Trump” said Trevor Greetham, head of multi-asset investing at Royal London Asset Management, citing the administration’s latest broadsides against Canada and South Korea.

“Credible hints that the US may intervene to buy the yen shows policymakers just don’t care about the downside risks to the dollar,” Greetham added, a reference to speculation in recent days that the US and Japan would jointly intervene in currency markets to stop the rapid depreciation of the yen against the greenback. 

Analysts at MUFG said the euro was “benefiting from its role as the anti-dollar”, as worries swirl over US policymaking.

A number of issues are weighing on the US currency simultaneously, analysts said, including worries about a potential US government shutdown, sharp moves in the yen, rumours about the White House’s pick for chair of the Federal Reserve and tensions between the US and its Nato allies — which came to a head last week over Trump’s demands to take over Greenland.

“Greenland reignited the dollar’s risk premium,” said Lefteris Farmakis, senior FX strategist at Barclays. “The upending of the post-World War II order is a long-term negative for the dollar,” he said, as it encourages investors to move out of dollar-denominated assets or to hedge their dollar exposure.

Farmakis added that the FX intervention rumours were “amplifying” the fall in the US currency, by sending a signal of the administration’s willingness to let the dollar depreciate in a bid to support the competitiveness of US exports.

Many investors expect the dollar to weaken further in 2026, with analysts at JPMorgan saying on Tuesday that “reasons to be bearish on the dollar remain intact”.

Meanwhile, economic and political developments across the Atlantic have allowed investors to turn more positive on the euro and sterling.

Recent economic data from Germany, the Eurozone’s biggest economy, has buoyed sentiment among some investors, said Constantin Bolz, head of G10 FX strategy at UBS Global Wealth Management.

Germany’s economy grew 0.2 per cent in 2025 — its first positive reading since 2022 — while a closely watched measure of activity in the construction sector rose in January to its highest since 2022. A broader measure of economic sentiment in the country is at its highest level since 2021. 

“Over the last few weeks, we could see the first hard data showing [an economic] recovery,” Bolz said. “Europe hasn’t grown for the last 15 years. If this fiscal spending really lifts growth, that should be supportive [for the euro].”

French political instability, which weighed on the euro last year, has also eased after the government survived two no-confidence votes last week over its budget plans. In the past week, the spread between French and German 10-year borrowing costs has shrunk from 0.67 percentage points to 0.56 points. 

In the UK, stronger economic data has combined with a “post-Budget bounce in sentiment” to support the pound, said Farmakis at Barclays. This month, traders have pushed back their bets on the next Bank of England rate cut from June to July.