Dollar Weakens Against Safe Havens as Trump Threatens European Tariffs Over Greenland

The US dollar weakened significantly on Monday following Trump’s announcement of 10% tariffs on European goods starting February 1, contingent on Greenland purchase rights. While the euro and pound initially fell to multi-week lows, both recovered as investors reassessed the dollar’s broader prospects. Safe-haven currencies like the Swiss franc and Japanese yen gained substantially, with the dollar index declining 0.19% to 99.18.

The US dollar faced significant pressure on Monday as investors fled to safe-haven currencies following President Trump’s latest tariff threats against European nations over Greenland. The announcement triggered a broad risk-averse movement across global markets, with the Japanese yen and Swiss franc emerging as primary beneficiaries of the flight to safety.

Trump’s Tariff Announcement Sparks Market Volatility
Trump announced over the weekend his intention to impose an additional 10% import tariff starting February 1 on goods from eight European nations: Denmark, Norway, Sweden, France, Germany, the Netherlands, Finland, and Britain. The tariffs will remain in place until the United States is allowed to purchase Greenland from Denmark.

Major European Union states responded strongly to the threats, with France and other nations describing them as blackmail and proposing a range of previously untested economic countermeasures in response.