_{ECONOMIC NEWS}

​U.S. Dollar Diverges from Fundamentals—What Investors Need to Know

The U.S. dollar index has experienced its sharpest drop since the COVID-19 crisis, raising concerns about a potential breakdown in the currency’s value. Despite strong U.S. bond yields, the dollar has weakened—a troubling disconnect suggesting deeper structural issues.

Key points:

• Historical parallel: The situation draws comparisons to the British pound’s decline in the 20th century, which led to a loss of global dominance and destroyed wealth for holders of the currency.

• Recent pressure: The dollar has been under stress since Trump’s tariff announcements in April, which may slow economic growth, reduce global trade (and thus dollar demand), or reflect a deliberate weakening strategy to boost U.S. manufacturing.

• Warning signs: The dollar has broken below a long-term uptrend against the euro, echoing the kind of breakdown that preceded the pound’s fall.

• Economic context: Like post-WWII Britain, the U.S. now faces a large trade deficit and a historic debt burden. Currency devaluation could be a strategy to ease these domestic pressures.

• Protective strategies: Investors are advised to diversify into other currencies like the Swiss franc or buy hard assets (e.g., gold, Bitcoin, real estate) that typically hold value during currency devaluation.

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_{GLOBAL NEWS}

Republicans Push $4T Debt Limit Boost Amid Internal Party Tensions

House Republicans have introduced a proposal to raise the U.S. debt ceiling by $4 trillion as part of a broader strategy to advance former President Trump’s tax agenda. The plan, released by the House Ways and Means Committee, ties the debt limit increase to the GOP’s tax priorities—allowing Republicans to bypass Democratic bargaining. However, this approach may create a time crunch to pass the sweeping bill. Treasury Secretary Scott Bessent has warned that the government may run out of funds by August without action. Meanwhile, Senate Republicans are proposing a $5 trillion increase, revealing internal party divisions over the size of the increase and spending reforms like Medicaid cuts. Read Now.