USD Strengthens Across Board as Trade War Fears Drive Safe-Haven Flows

The US Dollar Index surged 0.8% to 105.20 during the week ending July 11, marking its strongest weekly gain in two months as escalating trade tensions boost safe-haven demand. The dollar's broad-based strength comes amid rising US-EU trade disputes, with Washington's 30% tariff threats sending European currencies lower. EUR/USD dropped 1.2% to 1.0730, while GBP/USD fell 0.9% to 1.2850. Risk-sensitive commodity currencies suffered larger losses, with AUD/USD declining 1.5% to 0.6680 and NZD/USD down 1.4% to 0.6120. The trade war escalation has shifted market focus from central bank policies to geopolitical risks, supporting traditional safe havens USD and JPY. Technical analysis shows DXY breaking above key resistance at 105.00, opening the path toward 106.00. Further trade escalation could push the index toward 107.00, while any de-escalation might see profit-taking back to 104.50 support.