By bizn_fun 
After a dramatic 2025, when US President Donald Trump’s tariff announcements sent the dollar tumbling, traders of the currency were expecting a quieter year.
Recent weeks have shattered that complacency.
The dollar dropped to its lowest point in four years on Tuesday against a basket of currencies, hitting multi-year lows against the Euro and the pound as it fell 3% in roughly a week.
That slide has since slowed down, but analysts say the reprieve is likely to be temporary.
“Most people would think the dollar should, could, and would weaken further this year,” said Chris Turner, global head of financial market research at ING. “The jury’s out on the timing but less so on the direction.”
A weaker dollar reduces purchasing power for Americans – something overseas travellers know all too well. If that carries on, analysts say it risks fuelling inflation inside the US, as Americans face higher prices for imports.
The falls have also raised bigger questions about whether the dollar’s status as the world’s go-to currency – which for decades has helped keep borrowing costs in the US relatively low – might be under threat.
So what is driving down the dollar and what does it mean?