It was clear from some of the recent decisions taken by President Donald Trump concerning the US economy that he had a poor understanding of economic matters. Peter Navarro, his principal advisor, although with a PhD from Harvard, was known to be poorly versed in economic issues.

Some years ago he had written a book extremely critical of China. This thinking lent support to Trump's views about his country's relations with Beijing. The on and off approach towards using tariffs to protect the US industry that had been losing jobs to China and other east Asian countries had created great uncertainty among potential investors in the US economy. One result was the pressure on the American dollar which lost its value with respect of world's major currencies.

An index that measures the value of the dollar against a basket of major currencies ended a five-day decline on April 15, 2025. The dollar had fallen 8 per cent since the beginning of 2025 and was trading near a three-year low.

The decline in the value of the dollar had made imports more expensive for consumers in the United States even without counting the impact of tariffs imposed by President Trump. The decline in the value of the dollar was not expected by Trump's close associates. Scott Bessent, the Treasury Secretary, was surprised by the dollar's fall in value. He had expected the opposite to happen.

Sharp changes in the value of the dollar produce uncertainty for those who use the currency. "Both institutional investors and central banks are having to begin to think about what would happen should the dollar and the Treasury market no longer be the safe haven, said Joe Brusuelas, chief........

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