EddieJayonCrypto
11 Jul 25
Elias Haddad, vice president of Brown Brothers Harriman, attributed the US dollar's recent decline to reduced confidence in US trade, security, and fiscal policies, highlighting a disconnect between the dollar index and interest rate differentials due to policy uncertainty. He pointed to the Trump a...
The vice president of Brown Brothers Harriman, Elias Haddad, recently shared insights on the declining strength of the US dollar. In a CNBC interview, Haddad linked the sharp fall of the greenback this year to waning confidence in US trade, security, and fiscal policies. He noted a divergence between the dollar index and interest rate differentials, attributing this gap to policy uncertainty.
Haddad emphasized that the Trump administration’s protectionist trade stance is a major factor behind the US dollar’s weakness. Specifically, the average effective tariff rate surged from 2% to about 18% within the year, posing a downside risk to economic growth and an upside risk to inflation. Such dynamics are bearish for the currency’s value.
He further warned that the ongoing trade war might speed up the diminishing role of the US dollar as the foremost global reserve currency. Efforts to reduce the US trade deficit have resulted in fewer dollars circulating overseas and reduced dollar inflows into US securities. These factors together reinforce a bearish outlook on the US dollar’s near-term prospects.