The dollar index extended its decline on Thursday, falling below 97.8 to reach its lowest level since 2022, as renewed trade tensions and geopolitical risks weighed on sentiment.
President Trump announced plans to send formal letters to major trading partners within the next one to two weeks, outlining unilateral tariff measures aimed at pressuring countries into new trade agreements.
This comes as the current 90-day pause on reciprocal tariffs is set to expire next month.
Adding to market unease, geopolitical tensions intensified after Iran threatened to strike US bases if nuclear talks collapse.
Meanwhile, softer-than-expected US consumer and producer inflation data added to the downward pressure on the greenback.
The weaker inflation prints bolstered expectations that the Federal Reserve will deliver two interest rate cuts this year.
The dollar posted its steepest losses against the euro, Swiss franc, and Japanese yen.
