US dollar may face sharp decline

Traders participating in global financial markets are placing record-level bets on a depreciation of the US dollar, Bloomberg reported.

According to the agency’s calculations, demand for financial instruments that profit from a decline in the dollar’s exchange rate has reached a historic high.

Premiums paid on short-term options have risen to their highest level since 2011. Investors are demonstrating an extremely pessimistic outlook on the future of the dollar not only in the short term, but also over the longer horizon.

Experts note that since the introduction of tariffs in the United States in April last year, the dollar has experienced its sharpest decline and may fall to its lowest level in the past four years.

According to Jesper Fjærsted, Senior Analyst at Danske Bank, the unpredictable nature of US policy is exerting negative pressure on dollar positions.

Karl Schamotta, Chief Market Strategist at Corpay, pointed out that the United States’ shift toward protectionism and the reduction of its security commitments are forcing other countries to increase defense spending. This, in turn, is narrowing the economic growth and interest rate differentials that had previously worked in favor of the dollar.

Analysts estimate that during the second presidential term of US President Donald Trump, the value of the dollar has declined by nearly 3 percent. Trump himself has repeatedly stated that a weaker dollar helps boost US exports.

It is worth noting that the Central Bank of Uzbekistan has set the official exchange rates of foreign currencies against the Uzbek sum effective from January 28, according to which the official exchange rate of the US dollar stands at 12,128.02 sums.