On April 4, 2025, the Hungarian forint began to weaken against the euro and fell more sharply against the US dollar.

At the time of reporting, the exchange rate was 404.5 forints per euro and 367.6 forints per dollar.

By 1 PM, the euro had risen to 406.6 forints.

The dollar had strengthened against the euro on the same day, explaining the forint's greater decline versus the US currency.

Although Hungary released disappointing macroeconomic data regarding industrial production on April 4, the forint's depreciation was not solely attributable to domestic factors.

The currency's dip aligned with a broader trend affecting emerging market currencies, where several Asian, Australian, and New Zealand currencies experienced more significant falls.

Key to understanding the forint's weakened position is the announcement of new US tariff measures by President Donald Trump.

This announcement, made ahead of a day commemorating liberation in the US, has increased uncertainty in the global economy.

In such environments, currency traders often seek safe havens, leading to increased purchases of stable currencies like the dollar, euro, and Swiss franc while moving away from perceived riskier assets.

Interestingly, US traders preemptively engaged in buying Asian, Latin American, and European goods in anticipation of Trump's tariff measures, further exacerbating the country's trade deficit while simultaneously weakening the dollar.

Economic experts anticipate challenging times ahead for the global economy as these trade tensions evolve.

President Trump has employed tariffs as instruments of negotiation, threatening further duties against entities reciprocating his policies.

This strategy raises concerns about the potential stalling of economic growth and rising inflation in the US, along with declines in the much-touted revenues from American energy exports.

As these developments unfold, it remains uncertain whether the President will acknowledge the potential negative impacts of his policies.

Meanwhile, the burgeoning unpredictability within the US policy landscape risks diminishing the dollar's status as a safe-haven currency, potentially enhancing the appeal of alternative instruments such as the Japanese yen, Swiss franc, gold, or even cryptocurrencies like Bitcoin.

Should the Trump administration fail to foster trust within the economic framework through consistent policies rather than aggressive communication and erratic measures, US businesses and the dollar may bear a disproportionate share of the fallout from these trade dynamics.

In this environment, multinational companies face the dilemma of whether to establish operations in the US, attracted by potentially favorable conditions, or to avoid a market characterized by such volatility.

European corporations, in particular, are weighing their options amid these uncertainties, highlighting the complex interplay of trade policies and market stability.