dollar

The U.S. dollar just saw its biggest single-day drop since mid-December 2025, falling around 0.7-0.8%. The slide kicked in after Trump’s threats toward Europe over Greenland rattled global markets big time.
Investors freaked out, selling off U.S. stocks and Treasuries fast, while safe-haven currencies jumped higher. Traders are calling it a wake-up call—political drama can shake things up hard, even without any huge economic news.
Analysts are saying if this tension with Europe drags on, the dollar could stay under pressure, messing with global trade, import costs, and even U.S. borrowing rates. Some hedge funds are already shifting positions to guard against more wild swings.
The fallout? Higher rates, shaky investments, and fresh talk about whether the U.S. dollar can keep its spot as the top world reserve currency. This isn’t just a chart dipping—it’s politics hitting the financial world full force. 🌪️💵
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#BREAKING #TRUMP #dollar #WEFDavos2026 #WriteToEarnUpgrade

$ENSO 👀The New York Fed has already done rate checks, which is the exact step taken before real currency intervention. That means the U.S. is preparing to sell dollars and buy yen.

This is rare. And historically, when this happens, global markets surge.

Japan is under heavy pressure. The yen has been weak for years, Japanese bond yields are at multi decade highs, and the Bank of Japan is still hawkish. Together, this creates stress not just for Japan, but for global markets. That is why central banks are now taking the situation seriously.

Japan has already tried to defend its currency many times on its own. But it failed in 2022 and 2024. Even the July 2024 intervention only worked for short time.

History is very clear on this: When Japan acts alone, it does not work. When the U.S. and Japan act together, it does.

We saw this in 1998 during the Asian Financial Crisis. Japan’s solo interventions failed, but when the U.S. joined, the yen stabilized. We saw it even more clearly in 1985 with the Plaza Accord, when coordinated action pushed the dollar down nearly 50% over two years.

That changed everything: The dollar weakened. Gold, Commodities, Non US markets all pumped.

If the Fed intervenes, this is how it'll play out :

- The Fed creates dollars, sells them, and uses those dollars to buy yen.
- That weakens the dollar and increases global liquidity.
- And whenever the dollar is intentionally weakened, asset prices usually surge.

Now look at crypto.

Bitcoin has one of the strongest inverse relationships with the dollar and one of the strongest positive relationships with the yen. Right now, BTC yen correlation is near record highs.

But there is a catch.

There is still hundreds of billions of dollars tied into the yen carry trade. People borrow cheap yen and invest in stocks and crypto. When the yen strengthens suddenly, they are forced to sell those assets to repay loans.

We saw this in August 2024: A small BOJ rate hike sent the yen higher. Bitcoin crashed from $64K to $49K in six days. Crypto lost $600B in value.

- So yen strength creates short term risk for crypto.

- But dollar weakness creates long term upside.

Now, why is this bullish for crypto ?

Because Bitcoin is still well below its 2025 peak. It is one of the few major assets that has not fully repriced for currency debasement.

If coordinated intervention actually happens and the dollar weakens, capital will look for assets that are still cheap relative to the macro shift. Historically, crypto benefits strongly from that environment.

This may become one of the most important macro setups of 2026.$DUSK $ETH
#yen #ETHMarketWatch #crypto #dollar #WEFDavos2026

In 2025, nearly every major global currency appreciated against the U.S. dollar.The Swedish krona appreciated by nearly 20% against the U.S. dollar, followed by the Mexican peso and the Swiss franc.The dollar’s decline has been driven by monetary policy changes, trade tensions, and changing investor confidence.
Rank, Currency, Appreciation vs USD in 2025 (%)
1 Swedish Krona 🇸🇪 20.20%
2 Mexican Peso 🇲🇽 15.60%
3 Swiss Franc 🇨🇭 14.50%
4 South African Rand 🇿🇦 13.80%
5 Euro 🇪🇺 13.50%
6 Danish Krone 🇩🇰 13.30%
7 Norwegian Krone 🇳🇴 12.90%
8 Brazilian Real 🇧🇷 12.80%
9 Australian Dollar 🇦🇺 7.80%
10 British Pound 🇬🇧 7.70%
11 Singapore Dollar 🇸🇬 6.20%
12 Canadian Dollar 🇨🇦 4.80%
13 Taiwanese Dollar 🇹🇼 4.40%
14 New Zealand Dollar 🇳🇿 2.80%
15 South Korean Won 🇰🇷 2.20%
16 Japanese Yen 🇯🇵 0.30%
Several major currencies rose significantly versus the U.S. dollar. The Swedish krona led the list with over 20% appreciation. It means that one krona bought much more than a year before. Additionally, the Mexican peso and Swiss franc both climbed strongly against the dollar. These gains show confidence in these countries’ economies and relative strength against a weakening greenback.
European currencies like the euro, Danish krone, and Norwegian krone also posted double-digit gains against the U.S. dollar. For many of these countries, stable inflation, strong trade balances, or higher interest rates made their money more attractive to investors.
Even emerging market currencies like the South African rand and Brazilian real rose, which is a notable development because such currencies often struggle when the dollar strengthens.
This decline in U.S. dollar value can make imports into the U.S. more expensive, while U.S. exports may become cheaper overseas.
China’s Currency (The Yuan)
China’s currency, the yuan (renminbi), does not appear on the top list because it only gained modestly against the dollar relative to others. Still, it strengthened by about 4-4.5% in 2025, marking its best yearly performance in several years. Reuters reports that the yuan was helped by the broad weakness of the dollar and by China’s strong trade surplus.
Additionally, the yuan’s gains came more from reduced demand for dollars than from a strong belief in China’s currency fundamentals. China’s central bank also manages the yuan’s value and lets it move within a controlled range rather than float freely like some other currencies.
📉Why the U.S. Dollar Is Declining
There are multiple reasons that push the U.S. dollar lower in 2025.
1. Monetary Policy
One of the factors responsible for the weakness of the U.S. dollar in the year 2025 is the change in expectations of interest rates within the U.S. economy. In 2025, the U.S. Federal Reserve lowered its benchmark interest rate multiple times as economic growth slowed. Lower interest rates imply lower returns on U.S. investments such as bonds and savings. Consequently, foreign investors choose to move their investments to other countries where interest rates are high. This means a lower demand for the U.S. dollar.
2. Trade and Political Uncertainty
Another factor that contributed to the depreciation of the US dollar is the escalating trade and political uncertainties. In 2025, the Trump administration introduced a broad range of reciprocal tariffs on several countries. This move led to higher import costs for U.S. businesses and consumers, while also undermining confidence among companies and investors. Therefore, when uncertainty prevails in trade rules, firms put off investments, and foreign investors become more risk-averse about holding U.S. assets.
Some economists believe that the dollar has reached the point where it is far too strong and is correcting itself. This is because the value of the dollar has dropped by some 10-11%, its sharpest fall since the early 1970s.
3. Global Reserve Shifts
Nations and investors are diversifying their assets away from dollars, which include the Euro, the Swiss Franc, and Gold. The share of dollar holdings in global foreign-exchange reserves has dropped over time, which weakens the dollar’s dominance.

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