Dollar Surges Against Majors as Trump Announces Steel, Aluminum Tariffs
The US dollar strengthened against most major currencies following President Trump's announcement of tariffs on steel and aluminum imports, triggering increased demand for the reserve currency.
Norway's krone, Canada's dollar, and Australia's dollar led the decline against the greenback after Trump stated he would impose 25% tariffs on imports starting Monday, applicable to metals from all nations. The euro depreciated by 0.3%, while the Chinese offshore yuan weakened by 0.2%.
"The risk remains that protectionist policies may escalate over time," said Billy Leung, investment strategist at Global X ETFs. "This could lead to inflationary pressures, prompt the Federal Reserve to adopt a cautious approach to rate cuts, and strengthen the dollar."
The dollar's gains extended its 0.3% advance from Friday after Trump's suggestion of retaliatory tariffs on trading partners, though specific details remain unclear. The global reserve currency has risen approximately 7% from its September low and has outperformed all G-10 currencies in the past six months.