Key Points:

• The DXY Index has dipped below levels observed during Trump’s initial term.
• Investors are increasingly turning away from U.S. assets, leading to a decline in the dollar as trade tensions rise with China.
• Recently, China announced a raise in tariffs on U.S. goods to 125%, deepening the trade conflict.

The Dollar index (DXY), which evaluates the strength of the U.S. dollar against a variety of currencies, has slid below the 100 mark for the first time since April 2022. In January, CoinDesk revealed the DXY index was reflecting trends seen during President Trump’s first administration, which appears to be the case now: The index has plummeted over 10% from its recent high of 110, reaching a three-year low.

Investor confidence continues to shift away from U.S. assets, exerting additional downward pressure on the dollar as the trade spat with China escalates. Just prior to publication, China declared an increase in tariffs on U.S. goods, elevating the total tax to 125% from 84%, indicating a firm stand in the ongoing trade contention.

In contrast, Bitcoin (BTC), showing low volatility compared to stocks, remains steady, trading above $81,000.