For the past 10 years, the dollar has been doing very well; it has been the de facto global currency, even gaining strength after the pandemic.
However, in the last year, the dollar index, which measures its value against a range of currencies, fell by nearly 10%, marking its worst performance since 2017. The question on everyone’s mind is, why is this happening?
Why The US Dollar is Falling
Many people attribute the decline to many of President Trump’s policies. 
The tariff announcements last year and the tension between the U.S. and Europe about Greenland followed the dip of the dollar’s value.
Analysts also added that the US actions in supporting the Japanese yen was a sell-off of itself. Though, the U.S. Treasury Secretary Scott Bessent said there was no direct U.S. intervention to aid Japan.
The policy landscape under the Trump administration has been called ‘erratic’, and many analysts believe it adversely affects the U.S. economy more severely than other global economies.
Global investors, particularly pension funds in Amsterdam and Denmark, are decreasing their U.S. Treasury allocations, suggesting a decline in confidence in the U.S. economy and the pattern show a potential ‘sell America’ trend in investment behaviour.
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Gold is The New Dollar
From recent trends, it is obvious that people and countries are moving away from the U.S. dollar, leading to a doubling of gold prices as investors seek safer investments. Gold experienced its largest annual gain since 1979 last year. This is because gold is regarded as a ‘safe haven’ asset.
Central banks all over the world are increasing their gold purchases or as they say increasing their purchases of bullion.
This trend means there is a preference for gold as a neutral reserve currency, thereby protecting countries from US policy dependence, especially in light of the threat posed by their assets being seized.
Should You Buy Gold?
Gold prices have recently achieved historic highs, trading at approximately $5,160–$5,180 per ounce as of late February 2026, with predictions suggesting a rise to $6,000 by year-end. However, the market is highly unstable, it even crashed earlier this month.
While gold will always be valuable, do not invest all your life savings.
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