After President Donald Trump announced a 90-day pause in imposing his “Liberation Day” tariffs, trade adviser Peter Navarro touted the possibility of “90 deals in 90 days.” In truth, it hasn’t been that easy, and the deadline is up on July 9. This Washington Examiner series, 90 Deals in 90 Days, will look at how we got here, where we’re going, and some of the unforeseen consequences that have cropped up. Part 1 looked at the uncertainty relating to tariff policy. This second part covers the unexpected slide in the dollar.

The value of the dollar has declined steadily throughout President Donald Trump’s second term, a trend that defies what would have been expected from his imposition of major tariffs.

Recommended Stories

• What are Trump accounts? Government launches $1,000 baby bonus
• WATCH LIVE: Trump Cabinet members participate in press conference on USDA National Farm Security Action Plan
• Swan song for supply-siders? 'Big, beautiful bill' signals shift in GOP

The dollar index was 97.5 on Tuesday, down from just over 99 about a month ago. The Bloomberg Dollar Spot Index registered as high as 110 in early January. The relative value of the greenback has fallen 5.8% over the past three months and more than 11% since the start of 2025.

Economists would have expected the dollar to strengthen in light of the largest tariff hike in decades, as fewer dollars would be traded for foreign goods.

However, a variety of factors have outweighed any boost to the dollar from tariffs, including uncertainty about fiscal and monetary policy and fear that the tariffs could push the United States into a recession.

The slide in the dollar undermines a key narrative advanced by the Trump administration in favor of tariffs, namely that the currency would appreciate and offset the adverse effect of the new tariffs on U.S. consumers. Treasury Secretary Scott Bessent testified in January that he expected that tariffs wouldn’t be fully passed onto consumers because of the dollar’s strengthening.

But that has not occurred.

Art Durnev, a finance professor at the University of Richmond, emphasized that the dynamic of higher tariffs resulting in a higher dollar hasn’t played out as expected.

“The tariffs should work in the opposite way; they should strengthen the dollar because the demand for foreign goods like imports from Europe declines, the demand for American goods presumably increases,” Durnev told the Washington Examiner.

Durnev attributes the drop in the dollar to investor fears that all of the major trade and budget changes made by the Trump administration will lead to an economic downturn.

“It means that the financial market story overweighs the trade story and one of the reasons is the uncertainty about tariffs,” he said.

The many changes to tariff policy in recent months, and since what Trump labeled “Liberation Day,” have made it difficult for companies and investors to know what is coming with trade. Trump imposed tariffs on allies and adversaries alike. For instance, Trump imposed 25% tariffs on Mexico and Canada.

However, many of the tariffs were later temporarily paused. Some were frozen until this week, but then Trump signed another order delaying his Liberation Day tariffs until Aug. 1, further adding to the confusion surrounding trade policy.

Ted Rossman, senior industry analyst at Bankrate, told the Washington Examiner that he thinks political uncertainty is to blame for the dollar’s decline this year.

Several factors could be blamed for driving down the dollar, “whether it’s tariffs or the deficit, I mean, that’s a big one, including the recent passage of the so-called Big Beautiful Bill,” Rossman said, referring to the passage of the Republican One Big Beautiful Bill Act, which is anticipated to raise deficits by trillions of dollars in the coming years.

In addition to fears about the federal debt, Rossman cited uncertainty about Federal Reserve monetary policy as a reason for the dollar’s decline.

Steve Kamin, a senior fellow at the American Enterprise Institute, said the recent dollar dip is a bit difficult to interpret.

“It could reflect fear and uncertainty about the U.S. economy … it could possibly reflect a view that greater fiscal deficits from the [One Big Beautiful Bill Act] would actually lead to greater trade deficits, and thus require a further decline in the dollar to equilibrate,” he told the Washington Examiner.

The declining dollar has real-world effects on U.S. consumers and companies.

In the U.S., exporters are the big winners from a decline in the dollar. The lower dollar means they can sell their products abroad more easily. U.S. technology companies like Apple, which sell a significant share of their products abroad, benefit from the lower dollar, at least in theory, as their goods become cheaper relative to foreign alternatives.

The decline is also beneficial for foreign travelers who want to come to the U.S. on vacation. The lower dollar makes exchange rates more favorable for travelers abroad and makes the U.S. a more appealing destination.

But conversely, the lower dollar is not good news for Americans who want to vacation in Europe or other countries this summer. For instance, the dollar is down more than 13% against the euro since the start of the year. That means, inflation aside, traveling to Europe would be much more expensive for American tourists this summer than it was six months ago.

That means a trip to Italy that usually costs $3,000 is now nearly $3,400, which could be the difference of a whole extra night’s stay in Europe.

Still, despite the decline, experts emphasize that the dollar still reigns supreme as the dominant global currency.

SWAN SONG FOR SUPPLY-SIDERS? ‘BIG, BEAUTIFUL BILL’ SIGNALS SHIFT IN GOP

And it is challenging to predict what is next for the value of the dollar because of the myriad factors at play. Rossman expects the dollar to find a floor and not keep drifting south.

“I would project more of a settling,” Rossman said. “I know that there’s been a downward trend recently, but I feel like a lot of that’s baked in at this point. Certainly, there are moves one way or the other that could skew things, but in general, I feel like we’re kind of finding a floor.”