From Yahoo Finance: 2025-04-02 19:41:00

Trump’s tariffs were expected to strengthen the dollar, but instead, it is weakening. Despite predictions of a stronger dollar due to tariffs, the ICE U.S. Dollar Index has declined by nearly 4% in the first quarter of 2025.

Treasury Secretary Scott Bessent anticipated a stronger dollar offsetting the inflationary impact of tariffs, but the opposite has occurred. Some experts fear a weaker dollar could exacerbate inflation, leading to potential delays in interest rate cuts by the Federal Reserve and further stock hits.

SocGen has proposed a “peak-dollar” basket of stocks with heavy international exposure that could benefit from a weaker dollar. Companies like Morgan Stanley and tech giants like Microsoft and Google are included, with potential earnings boosts of 6% to 7% if the dollar depreciates significantly.

Trump’s tariff policies have soured investors and consumers on U.S. markets. The administration’s haphazard implementation of tariffs has also tested investor patience and made assessing risk more challenging. Analysts warn that the administration’s stance on tariffs may impact the dollar’s reserve status and global relationships.

Read more: Trump’s tariffs are having a surprising impact on the U.S. dollar. Here’s how investors can benefit.