Markets are concerned the Trump administration wants a weaker dollar through trade deals, triggering currency volatility. However, an insider claims US officials aren’t including currency pledges in negotiations, with Treasury Secretary Bessent being the only person authorized to discuss such matters.
While the dollar has dropped 8% since Trump took office, Bessent consistently maintains the “strong dollar policy is intact” and recently confirmed no currency discussions occurred during China talks.
Markets remain skeptical due to Trump’s history of criticizing Asian currency manipulation and his appointment of advisers who’ve explored reducing the “burdens” of the reserve currency. Traders believe the administration’s goals of cutting trade deficits and boosting US manufacturing naturally require a weaker dollar, causing fluctuations in Asian currencies including South Korea’s won, the Japanese yen, and Taiwan’s currency.