The US dollar is suffering gravely at the moment, hitting its lowest in terms of its valuation and worth. The currency evolution has hit USD hard, with Trump’s fierce tariff policies adding more to the rising de-dollarization narratives. That being said, the US dollar is now losing its prestige gradually, shedding value, and at the same time, documenting a pivot of investors and countries dumping the US dollar for other alternatives. If this development continues, will the US dollar be able to survive it all and live to tell the tale?

Also Read: How the US Dollar Can Maintain Its Global Supremacy

The USD Is Plunging, And It’s Not Normal.

Per a recent post by Koyfin Charts, the US dollar is currently down 8.9% in a year, which is a depressing development to document at the moment. The currency has lately been hit from all sides, battered by Trump’s tariffs that have partially revived the de-dollarization agenda. Trump’s tariff policies have lately been trying to revamp the US economy. While Trump’s sole intent has been dedicated towards bolstering the US economy via tariffs, these tariffs have taken another direction, sparking the ominous trade war fears in hindsight.

The US Dollar is worth 8.9% less than it was at the beginning of the year. pic.twitter.com/vItUUb5r0l

— Koyfin (@KoyfinCharts) June 2, 2025

The American currency’s low price explorations have led several analysts to come up with their own predictions. A notable analyst, Otavio Costa, shared how the USD’s spiralling performance is poised to decay further in the future.

“The US dollar is on track for its worst performance in three decades. And I believe this move carries profound implications. This likely marks the beginning of a long-term downward trend for the dollar. With far-reaching implications across global markets in my view. It’s no coincidence that resource stocks, emerging and other developed markets, and foreign currencies are beginning to perform well. Gold led the way, and we’re now seeing the ripple effects play out across other asset classes, in my opinion.”

The US dollar is on track for its worst performance in three decades, and I believe this move carries profound implications.

This likely marks the beginning of a long-term downward trend for the dollar, with far-reaching implications across global markets in my view.

It’s no… pic.twitter.com/L9coJvEuHM

— Otavio (Tavi) Costa (@TaviCosta) June 3, 2025

De-Dollarization On The Rise?

The USD is now on track to document further lows in the near future as Trump’s new tariff regulations continue to rattle the markets.

“Any time we see a resurgence in tariff concerns, everyone begins to pile back into the ‘sell America’ trade once more.” As stated by Michael Brown of Pepperstone.

De-dollarization is currently spreading like wildfire at a rapid pace as the world grapples with the aftereffects of Trump’s tariff ordeal. For instance, US dollar FX reserves have now dropped to 50% from a spectacular 72% in 2002. The drop is massive, indicative of the USD’s devaluation and the countries’ pivot towards other alternatives. In addition to this, China has reduced its official US Treasury holdings by 27%, showing signs of reduced interest in the USD holdings.

The analysts at Morgan Stanley have also predicted the USD’s ambiguous future, claiming that the currency may continue to fall in the near future.

“We expect USD to continue to weaken (over the next 12 months). Thanks to a convergence in both U.S. rates and growth to peers.” Morgan Stanley strategists said in a note on Sunday.

Also Read: US Dollar To Fall In Orderly Way, Says Nomura’s Richard Koo