The U.S. dollar fell to its lowest level in four years on Tuesday, despite President Donald Trump claiming it was "doing great" in a speech in Iowa.
The greenback has retreated in the year since Trump returned to the White House, a stretch that's been punctuated by frequent tariff threats, strains in U.S. international relations and domestic strife, now playing out in Minnesota.
Specifically, the ICE US Dollar Index DXY fell to $95.81, sinking against a basket of rival currencies to its lowest level since Feb. 17, 2022, according to Dow Jones Market Data.
As a daily percentage decline, it was the worst day since April 10, 2025, when the dollar index tumbled 2% as markets convulsed in the wake of Trump's "Liberation Day" tariffs.
See: The dollar just had its weakest start to a year on record. Why it might be doomed to fall even further.
"We're talking about an administration that wants a lot lower rates with [an] increasing deficit," said Max Wasserman, co-founder and senior portfolio manager at Miramar Capital.
Other countries with high deficits may now take a more cautious approach, he said, adding that they may look to avoid cutting interest rates but instead focus on strengthening their fiscal and monetary positions.
The U.S. government is carrying historically high national debt, now exceeding $38 trillion, driven by persistent budget deficits, lower taxes and emergency spending. Trump has been pushing for lower interest rates since returning to office last year, because lowering short-term rates typically translates to reducing financing costs for the economy.
But that's not happening in the U.S. right now, as longer-duration rates BX:TMUBMUSD30Y stay elevated. "We are not showing any real fiscal responsibility on the world market. In fact, we're doing the opposite," Wasserman said.
Trump was in Iowa as part of a series of stops aimed at drumming up support for Republicans for midterm elections in November. He was asked by a reporter if he thought the dollar had declined too much. "No, I think it's great," Trump said. "I mean, the value of the dollar. Look at the business we're doing. No, the dollar's doing great."
Trump previously touted the benefits of a weaker dollar, saying it can drive down the cost of American exports, making it easier for U.S. businesses to complete globally, and strengthen the economy.
However, when asked Tuesday if he wants an even weaker dollar, he said: "No, I want it to be, just seek its own level, which is the fair thing to do."
The dollar also has weakened as Japanese bond yields climb on concerns about that nation's fiscal outlook.