In Tokyo, the dollar experienced a decline on Friday due to decreasing confidence in the U.S. economy. This led investors to move away from U.S. assets towards safe-haven options like the Swiss franc, yen, euro, and gold. Gold reached a new record high during early trading in Asia, while the Swiss franc achieved a fresh high of a decade.

Investors sold off Wall Street stocks after a relief rally on Wednesday when President Donald Trump momentarily halted tariff increases on various trading partners. This positive trend was short-lived as markets reversed direction within just 24 hours. Long-term U.S. Treasuries were also affected, causing 10-year yields to make their largest weekly increase since 2001.

Trump's decision to pause tariffs for 90 days did not include China. Instead, he raised duties on Chinese imports to an effective rate of 145%, intensifying the trade tension between the world's top two economies. The Chinese yuan hit a record low in offshore trading on Tuesday but recovered all losses the following day, showing strength in early trading on Thursday.

Market analysts noted a decline in demand for the U.S. dollar as a safe-haven currency, with foreign entities possibly repatriating funds and capital due to concerns over increasing system risks following Trump's tariff decisions. U.S. Treasury Secretary Scott Bessent claimed that the tariff adjustments were part of the plan to bring countries to negotiate. Trump acknowledged that market turmoil post-tariff announcements influenced his decision-making process.

Trump's unpredictable trade policy approach has unsettled global leaders and business executives, making it challenging to anticipate market trends. The dollar fell by 1.2% against the Swiss franc, reaching levels not seen since January 2015 following a nearly 4% decline on Thursday.