Morgan Stanley expects dollar to decline as economic risks for US increase

Morgan Stanley believes the possibility of the US federal government shutting down, weaker country's economy and rising value of foreign assets will contribute to the dollar decline ahead of the imposition of import duties by Donald Trump on April 2.

Since January this year, the US currency has fallen by more than 3%. According to Bloomberg, it has become a record year-to-date decline for the last 17 years.

Morgan Stanley strategists point out that US president Donald Trump's policies, which were thought to boost GDP growth, are now considered to be potentially negative for the country's economic rise.

The prospect of the US government shutting down on Saturday could put additional pressure on the dollar. Investors are following the budget debate in the US Congress closely to estimate future fiscal policy and the impact on the US economy. Senate Democratic leader Chuck Schumer highlighted the party's intention to reject the spending bill proposed by Republicans.