Trump Reverses Tariff Threats, Weakens Dollar, Boosts Currencies
President Trump's decision to drop tariff threats and rule out using force on Greenland weakened the dollar and strengthened major currencies, altering global market dynamics.
Insights:
On January 22, 2026, President Donald Trump donald trumpannounced a significant policy reversal by dropping tariff threats against allied nations and ruling out the use of force to seize Greenland. This unexpected move immediately impacted global currency markets, causing the U.S. dollar to weaken while bolstering risk-sensitive currencies such as the euro, sterling, and Australian dollar.
The dollar weakened by 0.49% to $1.1744 per euro and fell 0.69% to 0.7899 Swiss franc . Meanwhile, the Australian dollar rose 1.15% to $0.684 , reaching a 15-month high and marking its fourth consecutive daily gain. The Japanese yen also saw a slight weakening of 0.07% to 158.42 per U.S. dollar.
