The dollar index (DXY00) dropped to a 2-week low on Tuesday and finished down by -0.79%. The dollar retreated on Tuesday as President Trump's push to take over Greenland is reviving fears of trade confrontations between the US and its European allies, with little sign of de-escalation.
Overnight, President Trump threatened steep tariffs on French champagne after French President Macron ruled out joining a US-led peace initiative. There are also fears that rising tensions in Greenland could prompt European investors to dump their dollar assets. President Trump over the weekend announced a 10% tariff on goods from eight European countries starting February 1, rising to 25% in June, unless there's a deal for the "purchase of Greenland."
