The Sell-off of U.S. Treasuries Weakens Trump's Leverage in Lowering the Dollar Negotiations

Rabobank foreign exchange strategist Jane Foley stated that the recent sell-off of U.S. Treasuries has weakened Trump's leverage in negotiations for dollar depreciation with other countries. "If the U.S. Treasuries market becomes more fragile, he cannot bully everyone to the same extent." Earlier this month, after a significant drop in U.S. Treasuries, Trump announced a 90-day suspension of imposing higher retaliatory tariffs on most countries. There is speculation that Trump may seek a new "Plaza Accord," dubbed the "Mar-a-Lago Accord," to devalue the dollar. If this happens, it is likely to occur within the 90-day tariff suspension period, in exchange for a trade agreement. However, based on Trump's response to the U.S. Treasuries turmoil, this seems unlikely, Foley said.