Dollar Falls Further as Gold and FX Rally

Key Moments

Sentiment toward the Dollar Continues to Erode

The dollar came under renewed selling pressure after only a brief pause, even as US president Trump said earlier this week that the currency is “doing great” and that “I don’t think the dollar has declined too much”. That commentary stands in stark contrast to the ongoing deterioration in sentiment toward the greenback that has persisted since last year and shows no sign of reversing.

The underlying forces weighing on the US currency remain firmly in place. Market participants are still grappling with an incoherent trade policy and tariffs approach, alongside what is described as an erratic and uncertain geopolitical policy administration. Concerns that Federal Reserve independence is being undermined also linger, as do worries about currency debasement flows amid mounting global fiscal concerns.

Taken together, these factors have been pulling the dollar lower since last year, and all of them continue to exert pressure this year as well.

Major Currency Pairs Push Against the Dollar

In trading so far today, renewed selling of the greenback has driven notable moves in key currency pairs. EUR/USD is higher by 0.3% at 1.1990, once again approaching the key 1.2000 level. Price action this week has kept the pair at its strongest levels since June 2021.

At the same time, USD/CHF has fallen 0.4% to 0.7650, bringing the pair back toward fresh 15-year lows. The move underscores the intensity of the pressure bearing down on the dollar against the Swiss franc.

The Australian dollar is also advancing after a hot inflation report yesterday. AUD/USD is up 0.7% on the day to 0.7090, marking its highest level in two years.

Precious Metals Dominate Market Moves

The most dramatic action in markets today is not in currencies but in precious metals. Gold is up 2.5% so far today and has gained over 11% this week, trading at $5,555 at the moment. Earlier in the session, prices came close to reaching the $5,600 level. This surge comes just days after markets were still debating whether $5,000 would cap the move, highlighting how quickly sentiment and price dynamics have shifted.

The rapid rise reinforces the trading lesson that attempting to call market tops or “catch falling knives” can be a hazardous strategy, as illustrated by the swift move from discussions around $5,000 to current levels.

Silver is also advancing strongly, climbing over 1% to a new record above $118. The move is described as unrelenting, underscoring how aggressively investors have been bidding up precious metals alongside the dollar’s decline.