The USD DXY just posted its biggest weekly decline since April 2025. It fell towards the 98.5 level. The chart shows a clear breach of the recent range. This move indicates a worsening of the dollar’s strength. Markets are currently downplaying the decline in confidence in international capital flows.
DXY suffered its biggest weekly decline since April 2025.
The US dollar is currently struggling due to the following reasons:
-European anti-American asset sentiment over Greenland/tariff situation
-The investigation into Powell is seen as an attack on the Fed’s independence.
– Investors around the world move money… pic.twitter.com/gfHxFnPczR— Stacker Satoshi (@StackerSatoshi) January 24, 2026
One reason for the decline is anti-American sentiment in Europe. Shareholders are responding to escalating trade tensions. Greenland and President Trump’s tariff threats have strained diplomatic relations. Exposure to US assets is minimized by European funds. This will have a direct impact on dollar demand. DXY selling pressure accelerates.
Powell investigation shakes faith
This point is unclear in the Justice Department’s investigation into Jerome Powell. This is considered political interference in the market. There are concerns among investors that the Fed’s independence could be undermined. This image undermines confidence in US monetary policy. As a result, capital finds safer alternatives. Investors around the world are still redistributing their capital. Many reduce their dollar holdings. They flow into gold, the yen, and emerging markets. Some people are moving to crypto assets. Such actions reduce the liquidity of the dollar. They support negative trends.
Increase in US debt structure
US debt approaches $38 trillion. Interest payments this year could exceed $1 trillion. Investors are concerned about long-term sustainability. They are challenging fiscal discipline. These issues are weighing heavily on the dollar’s outlook. Metals and gold are strengthened. A weak dollar is also beneficial for cryptocurrencies. These are treated as hedges by investors. Decreasing DXY increases risk appetite. This is a favorable environment for Bitcoin and other hard assets. This indicates a general loss of confidence in the dominance of fiat currencies.
