‘Digital Gold’ Bitcoin Surges as US Dollar Slumps Under Trump’s Tariffs

The US economy is once again feeling pressure, and a big reason is President Donald Trump’s new round of tariff policies. These changes are creating uncertainty in financial markets and weakening the US dollar. Meanwhile, Bitcoin is gaining popularity as a safer place for investors to store their money.

Dollar Index Hits a 3-Year Low

The US Dollar Index (DXY) fell below 100 for the first time in three years, touching 99.01 before slightly recovering to 99.45. Since Trump returned to the White House, the index has dropped more than 7%, including a sharp 2% drop in just the past week. Many analysts blame the decline on Trump’s tough trade stance with China.

Normally, when the 10-year US Treasury yield rises, the dollar goes up too. But this time, they’re moving in opposite directions. This unusual trend shows that investors are worried and unsure about where the US economy is heading next.

Investors Seek Safet

While the dollar falls, Bitcoin is moving higher. Its price jumped from $74,500 to $82,500 as more investors looked for a stable place to put their money. Many now see Bitcoin as “digital gold”—a reliable hedge during uncertain times in traditional finance.

The US dollar isn’t just falling against Bitcoin—it’s also losing ground to other major currencies. The euro, Swiss franc, British pound, and even the Australian and New Zealand dollars have all strengthened. Some analysts say the euro could rise to 1.15 against the dollar if things continue this way, which shows a growing lack of global confidence in the dollar.

There’s also concern about the US government’s new budget plan, which just passed the House. The plan has raised questions about how future tax cuts will be funded. This is making investors more cautious about US assets like stocks and bonds.

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Inflation Slows – But It’s Not Calming Markets

The March inflation report showed a rise of just 0.1%, lower than the expected 0.3%. Normally, lower inflation would help support the dollar—but not this time. Markets seem to be more focused on bigger worries, like trade and fiscal policy, than short-term inflation numbers.

Adding more uncertainty, Trump has reportedly signaled—according to Bloomberg—that he may remove the Federal Reserve Chairman if interest rates aren’t cut soon. This introduces political risk at a time when financial markets are already on edge.

As long as trade tensions continue and interest rate policy remains unclear, the US dollar is likely to stay weak. Bitcoin, on the other hand, may keep attracting investors who are looking for alternatives to the traditional financial system.