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(Bloomberg) — The dollar has wiped out all of its gains since Donald Trump won the presidency in November as his aggressive tariffs upend global markets. 

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The Bloomberg Dollar Spot Index is hovering near its lowest since mid-October, right before the election, after tumbling in the wake of Trump’s tariffs announcement. While the currency recovered modestly in Friday trading, market volatility picked up again after China retaliated with levies on American imports.

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The greenback is on track for its worst week in a month, with the world’s primary reserve currency plunging alongside global bond yields and equities. The concern about tariffs overshadowed a solid report on US jobs Friday. Nonfarm payrolls increased above all estimates in a Bloomberg survey of economists. 

“Markets are more driven by the sentiment around tariffs and the potential hit to US growth from tariffs rather than hard macro data,” said Jayati Bharadwaj, a currency strategist at TD Securities. 

The $7.5 trillion a day foreign-exchange market had been on edge leading up to Trump’s April 2 tariff announcement, with a few false starts on levies muddying the outlook. Trump’s push to roll back decades of globalization and subsequent measures have led investors to bet against the dollar.

“Fundamentally the picture has changed,” said Meera Chandan, co-head of global FX strategy at JPMorgan Chase & Co. “At a minimum, it’s a cyclical change, but potentially it could be the start of a structural weakening in the dollar because we’ve come off a very long period of dollar strength.”

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Safe-haven currencies, the Swiss franc and the Japanese yen, outperformed all peers in the Group of 10, while the Australian dollar fell 3.2% Friday after China’s retaliatory measures announcement. It’s the worst drop for the Aussie since March 2020. 

Canada’s labor market unexpectedly weakened in March, shedding the most jobs in more than three years, according to a Friday report. The Canadian dollar fell as much as 1% Friday after three days of advances.

It’s all a stark contrast to earlier this year when Trump’s tax cuts and tariffs were seen as a reason to bet on a rally in the dollar. In February, US Treasury Secretary Scott Bessent said that “the strong-dollar policy is completely intact with President Trump.”

The dollar gauge had rallied about 5% after Trump’s election, peaking earlier this year before slumping more than 4% in 2025. It dropped 1.5% on Thursday, posting its worst day since November 2022. Chandan at JPMorgan sees the dollar falling further in the coming months, and has penciled in a slump to $1.14 per euro by year-end, from around $1.10 now. 

“The dollar bear market has arrived and is roaring,” said Paresh Upadhyaya, director of fixed income and currency strategy at Amundi, US, adding that the dollar gauge could fall 10% this year.

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Economy Key

For Paul Mackel, global head of currency research at HSBC, what’s key for the greenback is investor expectations about the outlook for the US economy.

“We know where the risk to the dollar lies – lower – if the view of a US slowdown alone persists,” he said.

Data out of the US have been pointing to a slowdown in growth, pushing speculative traders to turn bearish on the dollar, according to Commodity Futures Trading Commission data. 

“The blowback of US tariffs onto the US domestic economy leaves the dollar naked,” said Chris Turner, head of currency strategy at ING. “US rates continue to be marked lower, and not until we get some surprisingly good news from the US on tax cuts or deregulation may the dollar start to find some support.”

—With assistance from Augusta Saraiva, Matthew Burgess, Ruth Carson and Nathaniel Popper.

(Updates markets, adds US jobs data. An AI summary previously at the top of the story was removed as it inaccurately characterized Friday’s dollar move.)

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