The dollar index fell about 2% in August, with both technical and fundamental conditions pointing to continued weakness

The dollar index DXY fell about 2 per cent in August, partially erasing gains in July, its first monthly gain since President Donald Trump was sworn in. Wall Street expects the dollar to extend its more than 8 per cent decline so far this year as the economy shows signs of slowing and the Federal Reserve appears poised to cut interest rates again. Mr. Trump's questions about the Fed's credibility and the reliability of economic data have further undermined the dollar's appeal. "Recent moves by the US government will have long-term implications," wrote Jayati Baladwaj, head of FX strategy at TD Securities. "This is eroding the dollar's safe haven status and the risk premium should start to weigh on the dollar." Technical analysis also points to a clear downward trend for the dollar. Options pricing on Thursday showed traders expected the dollar to fall modestly over the next three to six months. The dollar index fell below its 100-day moving average in early March and has been under pressure. Two attempts to break through this month have failed, making it an important resistance level.