The American currency is heading towards the worst first half of the year in over 50 years. The dollar index, measuring its strength against a basket of six major currencies, has already fallen by over 10 percent. The dollar has typically been a safe haven for investors. Today, it is a source of concern.
On Monday, the American currency weakened by another 0.2 percent as the U.S. Senate prepared to vote on amendments to Trump's tax plan, described by the president as 'big and beautiful.' The legislation is likely to increase U.S. debt by $3.2 trillion over the next decade, raising concerns about the stability of American borrowing and causing capital to flee from the treasury bond market.
Investors are worried about the fiscal future in the United States, considering the enormous debt and the need to incur record debt while simultaneously planning tax cuts. Currently, none of the rating agencies has the highest status for the American debt market, and potential plans for joint bond issuance in the eurozone may harm the U.S. in terms of competitiveness. Additionally, the role of the dollar has been undermined by the trade war, and even with trade agreements with key partners, the desire to move away from ties with the U.S. is likely to continue.
Unfortunately, the weakness of the U.S. dollar is not helping cryptocurrency prices - in this sector, investors continue to pursue a conservative policy bordering on panic
