Forex Review. The dollar sees no reason to panic
Donald Trump is threatening countries with higher tariffs if they play games by rejecting deals. They say the Supreme Court unwittingly gave him more power and power. The White House can use licenses to do terrible things to other states. Judging by the fall of the EURUSD, such statements evoke a smile rather than fear.
When trying to predict the exchange rate, you need to ask yourself the question, who benefits from this? Finding winners and losers gives you a lot. When Donald Trump returned to power, tariffs became an inevitability. And many investors sold EURUSD, believing that the duties would ruin the export-oriented economy of the eurozone. The EU is the largest importer of the United States, which means it has to pay more than the rest.
However, numerous studies, including an analysis by the Federal Reserve Bank of New York, have shown that up to 90% of shipments to the United States are actually paid for by Americans themselves. This means that the increase in tariffs by 10 percentage points to an average rate of 16% in 2025 has hit the US economy more than its competitors. They used fiscal incentives to support their exporters. As a result, there has been a seemingly paradoxical increase in foreign trade surpluses in many countries.
If Americans have to pay for everything, then reducing the average fee rate from 16% to 13.7%, according to Yale University, should improve things primarily in the US economy. This figure takes into account Donald Trump’s new tariffs of 15% for a period of 150 days, introduced in accordance with Section 122 of the Trade Act.
However, 15% is significantly less than the 145% introduced at the peak of the escalation of the trade conflict with China. In addition, even after numerous deals were concluded, duties against most countries fell to 15-20%.
There is another important nuance that allows us to assert that the snake’s sting was indeed pulled out. Section 122 of the Trade Act can also be challenged in court, just like previous legislation. It provides for the introduction of tariffs in the event of a balance of payments crisis. There is no trace of this in the USA. If it were, foreigners would withdraw money from the markets en masse, and the dollar would go to hell.
Thus, just as the Supreme Court overturned Donald Trump’s old tariffs, he may, after a while, put an end to the new ones. And the US economy and the greenback will benefit from this.
