USD index weakens to 101.50 as US tax policy uncertainty weighs

The US Dollar Index declined 0.5% to 101.50 as political uncertainty over potential tax policy changes dampened dollar sentiment. EUR/USD advanced to 1.0575, while GBP/USD reached 1.3150, capitalizing on broad dollar weakness. USD/JPY retreated to 146.20 as safe-haven flows benefited the yen. EUR/GBP remained stable at 0.8050, suggesting synchronized movement in European currencies against the greenback. Market participants express concern over proposed tax legislation that could impact corporate earnings and economic growth. Technical indicators show the Dollar Index breaking below its 20-day moving average at 101.80, opening potential for further decline toward 101.00 support. The combination of political uncertainty and shifting monetary policy expectations creates a challenging environment for dollar bulls. Near-term resistance stands at 102.00.