The current global uncertainty surrounding tariffs and their potential impact on U.S. growth has resulted in investors turning away from the traditionally safe option of the dollar, seeking alternative havens instead. President Donald Trump's recent announcement of extensive tariffs on various countries, particularly on China, has unsettled the markets, causing the dollar to decline and prompting a shift towards other safe havens.

The dollar's status as a top safe-haven choice has been tarnished by the domestic turmoil generated by Trump's tariff policies, raising concerns of a possible U.S. recession. Although the dollar usually strengthens during stock market declines, it has not shown the usual trend lately, indicating that it is not attracting safe-haven investments. Experts like Russell Investments' Van Luu are reconsidering the dollar's position among the traditional safe-haven currencies, noting the currency's recent underperformance.

The dollar index has experienced a nearly 4% decline this year, its weakest beginning since 2016, revealing investor reluctance to fully assess recession risks. Investors are shifting away from U.S. assets due to fading economic superiority, as noted by Eastspring Investments' Rong Ren Goh. Despite the current dollar weakness, some investors speculate that it could rebound once global growth diminishes amid Trump's economic strategies.

In contrast, gold has maintained its historical role as a safe-haven asset preceding modern financial systems. During periods of market turmoil, such as the 1970s energy crisis or the 2007-08 global financial crisis, gold prices have typically surged due to heightened investor anxiety. Amid the recent COVID pandemic and global energy challenges, gold prices have skyrocketed to record highs above $3,000 per ounce, attracting interest from central banks, portfolio managers, and individual investors seeking a hedge against inflation and economic uncertainties associated with the dollar.