Dollar in Trouble: Trump's Aggressive Policies Impact US Growth
At the beginning of the year, all analysts expected a strong dollar. However, by the end of the first quarter, the greenback is going through a rough patch. Donald Trump's aggressive policies, based on trade barriers, risk negatively impacting US growth. The European response, strong and based on increased spending, has changed the game. American consumer confidence is at its lowest in 4 years.
Initially, expectations suggested a positive impact from tariffs. But it's the US economic data that's causing concern. Current actions will lead to an increase in the unemployment rate following the layoff of public agents. At the same time, the war on illegal immigration will reduce the availability of labor, thus affecting future prices. Economists are struggling to track the implementation of Trump's electoral promises, which lack a precise timeline for reforms. He's taking action on all fronts, disrupting any analysis of the effects of ongoing projects.
For the dinar, we've seen an appreciation of 0.7% against the dollar over a sliding year. It's still too early to assess the impact of these dynamics on Tunisia's balance of payments. However, a strong euro means higher export revenues and cheaper imports of raw materials and base products. All contracts are negotiated in US dollars, which benefits our business as a net importer of these products. But overall, poor US growth means a global slowdown, which is not good news.
