US Dollar Weakens Ahead of G7 Meeting as Traders Anticipate Policy Shift

The US dollar slumped to a two-week low as market sentiment turned increasingly bearish ahead of the G7 meeting. Traders globally are scrutinizing the event for signals that the TRUMP administration may endorse a weaker dollar policy. Bloomberg reports fading confidence in Washington’s commitment to maintaining dollar strength, with investors already positioning accordingly.

Japan’s Finance Minister Katsunobu Kato confirmed plans to discuss currency movements directly with US Treasury Secretary Scott Bessent during the summit. South Korea has similarly engaged in currency talks with US officials this month, highlighting growing international concern about dollar volatility.

Domestic pressures compound the dollar’s weakness, with Washington debating $4.5 trillion in combined debt and tax measures. The potential fiscal expansion comes alongside credit rating concerns, creating a perfect storm for the greenback.