One of the notable things about the ongoing rout in financial markets is the fact that the dollar is also tumbling. That isn’t how it typically works. In bouts of volatility, the dollar tends to do well, serving as a haven for investors. The move also undercuts one of the main arguments that Trump’s economic advisors have long promoted as to why tariffs would not be inflationary. They argued that tariffs would raise the value of the dollar, helping to offset the impact of rising prices. Some strategists say the drop — even after a slight rebound today — reflects intensifying fears of a U.S. recession because of tariffs. Others say it could reflect something even more pernicious: Investors are starting to question U.S. economic exceptionalism.
3:46 pmNEW YORK (AP) — The sell-off for financial markets worldwide is slamming into a higher, scarier gear on Friday.
The S&P 500 tumbled 5.7% as Wall Street’s worst crisis since the COVID crash deepened after China matched President Donald Trump’s big raise in tariffs announced earlier this week. The move increases the stakes in a trade war that could end with a recession that hurts everyone.
