The US dollar’s strength could be unsustainable if President Donald Trump proceeds with his proposed sweeping tariffs, according to currency analysts at Bank of America.
In their latest report, Athanasios Vamvakidis and Claudio Piron highlighted that while the market has already priced in targeted tariffs on specific products, broader trade restrictions could be a “negative surprise” that would likely weaken the dollar.
Comprehensive Tariffs Could Harm US Dollar
Vamvakidis and Piron pointed out that while certain tariffs are anticipated, the broader tariff measures would create uncertainty, especially given concerns about a potential economic slowdown in the US. They noted that the dollar’s strength is not expected to hold up once these broader tariffs are implemented. Despite logistics delays and potential room for negotiations, the analysts warned that the market remains concerned about the US economy’s slowdown.
Tariffs Stir Global Concerns
On March 26, Trump signed a memorandum imposing a 25% tariff on imported cars, scheduled to take effect on April 2. This move has raised alarms, particularly in Japan, with experts fearing major disruptions in global supply chains. Hideo Kumano, chief economist at Dai-ichi Life Research Institute, criticized the US tariff policy, stating that it would not benefit the economy and could instead bring risks to the global economy.
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Source: https://coindoo.com/us-dollar-at-risk-as-trumps-tariff-plans-loom-bank-of-america-analysts-warn/