FOREX-Dollar falls as investors lose confidence in US assets

By Lucy Raitano and Kevin Buckland

LONDON, April 11 (Reuters) - The dollar fell broadly on Friday as ongoing concern about U.S. tariffs undermined confidence in the currency as a safe haven, sending it to its lowest in a decade against the Swiss franc and a three-year low versus the euro.

In its latest retaliation against U.S. tariffs, China said it would impose 125% duties on U.S. goods from Saturday, up from 84%.

That added to a global selloff that has battered stocks and even once safe-haven U.S. Treasuries - 10-year yields are on course for their biggest weekly jump since 2001. MKTS/GLOB

"Before it was more like a dollar deleveraging; this is just a dollar crisis," Francesco Pesole, FX strategist at ING, said.

"We need to get something from (U.S. President Donald) Trump essentially ...it (the dollar) is clearly telling us that markets are very minded to sell America," he said.

U.S. Treasury Secretary Scott Bessent on Wednesday said the plan for most U.S. trading partners had been to soften tariffs once countries came to the bargaining table.

Trump, however, later indicated the turmoil in markets since his April 2 tariff announcements had been factored into his thinking.

The dollar index =USD, which measures the currency against six main peers, sagged as much as 1.2%, taking it temporarily below the 100 level for the first time since July 2023.

"I'm deeply concerned about a lack of confidence among investors in the U.S. now," said Nomura strategist Naka Matsuzawa. "It's a no confidence vote from not just the equity market but also Treasury market participants in the Trump administration and its policies."

Safe havens were among the standouts on Friday, with the dollar dipping to 0.81150 Swiss francs CHF=EBS in early European trading, its lowest since January 2015, extending Thursday's nearly 4% plunge.

The Swiss National Bank said it had no comment on the franc's strengthening.

"The SNB is in a delicate situation. They probably would like to intervene more but it's very hard right now. I can't see them doing this on a larger scale," said Michael Pfister, FX analyst at Commerzbank.

He said the franc's appreciation would worry the SNB because of its deflationary effect.

The dollar also lost as much as 1.4% against the Japanese yen to 142.37 JPY=EBS, and was last down 1.2%.

Vis Nayar, chief investment officer at Eastspring Investments in Singapore said that the U.S. administration's tariff policy suggest it is less concerned about the strong dollar.

"The only flip side to that is that risk aversion still kind of likes the dollar, but we've seen on balance in the last week that the dollar is going to drop. U.S. exceptionalism? I think that's challenged now," he said.

The euro surged 1.14% to $1.136025, earlier jumping as much as 2.5% to its highest in three years. It also rose 0.5% against the pound EURGBP=D3 in a sign of its outperformance. The pound was up 1% against the dollar, at $1.30930. GBP=D3

European Central Bank President Christine Lagarde on Friday said the central bank was ready to deploy its instruments to maintain financial stability and had a solid track record in devising tools when required to deal with turbulence.

China's yuan fell sharply against the euro, which hit an 11-year high against the currency in the offshore market.

This week, it fell to its weakest on record against the dollar, both onshore and offshore, though it has since rebounded. The dollar was last down 0.2% against the offshore yuan at 7.2965. CNH=D3