Dollar Tumbles Amidst Tariff Tensions Over Greenland

The dollar fell as investors moved to safe havens like the Swiss franc following U.S. President Trump's tariff threats against Europe over Greenland. European leaders are working to avert a potential trade war while markets respond with currency shifts, highlighting the impact of policy uncertainty on the dollar.

The dollar suffered a setback on Monday as investors sought refuge in safe-haven currencies such as the Swiss franc. This movement followed U.S. President Donald Trump's recent tariff threats against Europe over Greenland, which spurred risk-averse sentiment across global markets.

In response, European leaders convened to prevent a trade war, opting to intensify diplomatic efforts against the tariffs while also preparing retaliatory measures. European currencies rebounded in overnight trading, with the euro, pound, and Scandinavian crowns rising. Meanwhile, the Swiss franc saw its largest single-day gain against the dollar in a month.

The euro appreciated by 0.3% to $1.163, and the pound increased by 0.27% to $1.3415 in midday European trading. Market reactions underscore the dollar's vulnerability in the face of U.S. policy uncertainty, even as analysts warn against underestimating the currency's enduring safe-haven status.

(With inputs from agencies.)