The value of the U.S. dollar has sharply declined over the past few days, hitting its lowest point in nearly four months against the euro. The dollar has also weakened against other major currencies. By Wednesday, the exchange rate had climbed from 1.038 dollars per euro to over 1.07 dollars per euro, marking a 3% decrease in the dollar’s value in just a few days.
Economic instability in the United States appears to be a contributing factor. Early indicators suggest that the economy is not performing well under President Donald Trump’s new administration. The introduction and anticipation of new import tariffs have caused unrest, and the government’s efforts to downsize the federal workforce have further fueled uncertainty.
Conversely, the euro has strengthened in recent days, largely due to developments in Germany. According to an analyst from Reuters, the German government plans to increase spending on infrastructure and may remove its debt ceiling. This would allow for additional government spending, providing a boost to the euro. As the largest economy in the eurozone, Germany’s economic policies have a significant impact on the euro’s value.