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The US dollar index is down by 0.2% at 97.890 as of 9:46 a.m. ET
on Wednesday.

That brings the dollar back to roughly where it was just before
the US presidential election. The index closed at 97.861 on
November 8, the day of the election, according to Bloomberg data.

Analysts have suggested that the currency is suffering from
the tumult of news coming out of the embattled Trump
administration in the wake of the
firing of FBI Director Jim Comey
and bombshell reports that
the president
shared classified information
with Russian Foreign Minister
Sergey Lavrov and Ambassador Sergey Kislyak.

In particular, markets may be worried that the recent
developments could stall the economically stimulative tax and
infrastructure policies many investors hoped for after the

“The US dollar has drifted lower against most of the major
currencies as the culmination of news from Washington, escalating
already rising concerns about the economic agenda that was to
bolster growth with dramatic tax reform, infrastructure, and
re-orienting trade,” Marc Chandler, global head of currency
strategy at Brown Brothers Harriman,

Further, recent economic data have been disappointing, which may
also be weighing on the dollar. Chandler wrote, “The political
morass that has engulfed the Trump administration is a major
distraction at the same time that the investors had grown more
concerned about the momentum of the US economy following the
recent disappointment with retail sales, housing starts, and
consumer prices.”

The greenback climbed
to a 13-year high after US President Donald Trump won the
election in early November, and hit 103.01 in
At least part of that appreciation was
attributed to markets reacting to Trump’s proposed fiscal policy

However, the index has been giving up those gains
over the last few months. Back in April, Trump said in
an interview
with the Wall Street Journal
, “I think our dollar is
getting too strong, and partially that’s my fault because people
have confidence in me.” Treasury Secretary Steven Mnuchin
later said in an interview
with the Financial Times
 that Trump is “absolutely
not” trying to talk down the strong dollar.

More recently,
markets have switched into a more risk-off positioning
the turmoil in Washington. The yen, gold, and US Treasurys
are rallying on Wednesday, while US stocks and the dollar are

“Markets have displayed a […] level of trepidation
over the last 24 hours with politics being the dominant theme,”
Jim Reid, strategist at Deutsche Bank, wrote in a morning

“The Trump headlines concerning the revealing of sensitive
information to Russian officials were initially at the forefront
of that. That was largely attributed to the big drop in the US
Dollar yesterday with the Dollar index falling -0.81% and to the
lowest level since November 8th,” he added.