The US dollar index fell about 2% in August, with both technical and fundamental factors pointing to continued weakness.

Jin10 data reported on August 29, the US Dollar Index DXY fell about 2% in August, partially erasing the gains from July — the first monthly rise of the dollar since President Trump took office. Wall Street expects that as signs of economic slowdown appear and the Fed seems ready to cut rates again, the dollar may continue its decline of over 8% so far this year. Trump questioned the credibility of the Fed and the reliability of economic data, further weakening the dollar’s appeal. “The recent actions of the US government will have long-term effects,” wrote Jayati Baladwa, head of forex strategy at TD Securities. “This is eroding the dollar’s safe-haven status, and the risk premium should start to weigh on the dollar.” Technical analysis also shows that the dollar is in a clear downtrend. Thursday’s options pricing indicated that traders expect the dollar to decline slightly over the next three to six months. The dollar index broke below the 100-day moving average in early March this year and has been under pressure ever since. Twice this month it attempted to break through the moving average but failed, making it an important resistance level.