Easy Trading Tips – The U.S. dollar took a significant hit on Friday, falling to a decade-low against the Swiss franc, as global investors lost faith in the stability of the U.S. economy and fled to traditional safe-haven assets like the franc, the Japanese yen, the euro, and gold.
Gold soared to a historic peak, while the Swiss franc reached levels not seen in ten years. This flight to safety was triggered by mounting unease surrounding the U.S. economic outlook and the unpredictable nature of trade policy under President Donald Trump.
Markets had briefly rallied on Wednesday after Trump unexpectedly announced a temporary suspension of higher tariffs on numerous trading partners. However, that optimism evaporated within 24 hours, sending Wall Street into a selloff and pushing long-term Treasury yields sharply higher — with the 10-year yield poised for its steepest weekly increase since 2001.
Notably, Trump excluded China from this tariff reprieve, instead intensifying the trade standoff by hiking duties on Chinese imports to an effective rate of 145%, escalating tensions between the world’s top two economies.
The Chinese yuan, which had plunged to record lows in offshore trading earlier in the week, bounced back sharply before softening slightly in recent sessions.
“There’s clearly a crisis of confidence right now among investors when it comes to the U.S.,” said Naka Matsuzawa, a strategist at Nomura. “It’s not just equities – we’re seeing it across Treasuries and forex markets as well. This is a broad-based reaction to policy inconsistency.”
While U.S. Treasury Secretary Scott Bessent defended the tariff reversal as a strategic move to encourage negotiations, Trump later admitted that the volatility in markets following his April 2 tariff announcements played a role in the decision.
Since his return to office in January, Trump’s unpredictable approach to trade — issuing threats of punitive measures only to later retreat — has left global leaders and business executives wary, complicating forecasts and adding to market turbulence.
The dollar fell as much as 1.2% to 0.81405 Swiss franc — its lowest point since January 2015 — after a sharp 4% drop the previous day. It also declined 1.1% to 142.88 yen, touching lows not seen since late September.
The euro made strong gains, rising up to 1.7% to reach $1.13855 — a level last observed in February 2022.
The U.S. dollar index, which compares the greenback to six major currencies, slipped as much as 1.2%, briefly dipping below the 100 mark for the first time since July 2023.
In offshore trading, the dollar slid as much as 0.3% to 7.2903 yuan before rebounding slightly to 7.3232. The greenback had already dropped 1.5% over the prior two sessions.
In a notable shift, the People’s Bank of China raised its yuan midpoint guidance on Friday — the first such adjustment in a week — acknowledging broader dollar weakness. Analysts viewed this move as a sign that while China is comfortable with gradual depreciation of the yuan, it intends to avoid a sharp decline.
Gold continued its relentless climb, jumping 1.5% to an unprecedented $3,219.84 per ounce.
Meanwhile, the benchmark U.S. 10-year Treasury yield rose nearly 10 basis points in early Friday trading, hitting 4.488%.
“Trump may have backed off due to rising yields, but that doesn’t rule out another test of the 4.50% level on the 10-year,” said Brent Donnelly, head of Spectra Markets. “We could be entering a new phase where the dollar faces sustained selling pressure, regardless of interest rate differentials.”