The Dollar Makes you a Hell of a Lot More Money! Forecast as of 28.07.2025
The White House’s intention to weaken the dollar became the main reason for the 10% drop in the USD index in 2025. In the second half of the year, the greenback will face another headwind — the Fed’s rate cut. Let’s discuss it and make a trading plan for EUR/USD.
The article covers the following subjects:
Major Takeaways
- Washington’s policy is aimed at weakening the dollar.
- The US has signed a trade agreement with the European Union.
- The futures market expects the Fed to cut rates by October.
- EUR/USD risks entering a consolidation range of 1.165–1.18.
Weekly Fundamental Forecast for Dollar
“Well, you know, I’m a person that likes a strong dollar, but a weak dollar makes you a hell of a lot more money.” That’s the best explanation from Donald Trump for why the USD index dropped by 10% in 2025. The man in the White House said he hadn’t lost sleep over the greenback’s plunge. “America doesn’t do tourism. You can’t sell tractors, you can’t sell trucks, you can’t sell anything if the currency is strong. It’s only good for holding back inflation. But there’s no inflation in the US!” So, what the president wants is what God wants. Should we be surprised by EUR/USD’s quick return to action?
Dollar dynamics vs euro and yen
Source: Bloomberg.
Investors had time to figure out Donald Trump’s policy. The markets believe the Republican will hold back from his harshest threats. They’ve recovered from the slump caused by America’s Independence Day. However, companies are freezing capital expenditures, redirecting supply chains, and cutting margins to absorb the shock. The White House has raised tariffs to the highest levels since the 1930s. They are six times higher than before the US president’s inauguration. No surprise that the global economy is slowing and will continue to slow.
Global Economic Forecast Dynamics
Source: Bloomberg.
Agreements with Japan and the European Union are more proof of Donald Trump’s success. The EU faced a 15% tariff, including on cars, and agreed to buy $750 billion worth of US energy products. It also agreed to invest $600 billion in the United States. Brussels hopes the 15% tariff is final. It’s already paying that rate because a base 10% tariff was added to earlier fees.
EUR/USD responded to that news with growth. Investors don’t like tariffs, but they would rather choose a stable 15% than a lower rate that could suddenly rise.
If a person is successful, then the deals associated with them also succeed. Trump-trade is aimed at weakening the dollar and boosting US stock indices. Speculators may increase long positions on the USD index, and the greenback may resist in the short term — just like Jerome Powell and the Fed are resisting White House pressure. However, another headwind may join the desire of Washington to see a weaker currency. Derivatives are confident that the federal funds rate will be cut by October, and they estimate the scale of monetary expansion in 2025 at 44 basis points.
Speculative Positioning Dynamics for the U.S. Dollar
Source: Bloomberg.
Weekly Trading Plan for EUR/USD
With upcoming FOMC meetings, the release of US GDP, inflation, and labor market data, and the final US tariff implementation date on August 1, EUR/USD risks a rollercoaster ride. Buying near the lower end of the 1.165–1.18 short-term consolidation range and selling near the upper end appears justified.
This forecast is based on the analysis of fundamental factors, including official statements from financial institutions and regulators, various geopolitical and economic developments, and statistical data. Historical market data are also considered.
Price chart of EURUSD in real time mode
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