The dollar's Trump bump has vanished

The Trump rally, 100 days in
The Trump rally, 100 days in

President Trump's victory and promise to implement an "America First" agenda propelled the US dollar to 13-year highs.

But the Trump bump has proved fleeting for the greenback, which has lost virtually all of its post-election gains.

The US dollar lost further ground against rivals on Tuesday. The euro jumped 1% to $1.109, the strongest level since the days before Trump's victory in November.

Likewise, the dollar index, which measures the greenback against a basket of rival currencies, dropped to territory unseen since just after the election.

So why is the dollar in the doldrums? Currency analysts point to a range of factors, including relief over France's presidential election, weak US economic growth to kick off this year and concern that Trump's political trouble will doom his economic agenda.

"Today, your key driver is the fact that Trump is facing an existential threat here," said Karl Schamotta, director of global market strategy at Cambridge Global Payments.

Schamotta pointed to the political fallout over reports that Trump shared classified information with a Russian official. (Trump has defended his conversations with Russia.)

Related: Why Wall Street isn't freaking out over Trump's stumbles

Win Thin, a currency strategist at Brown Brothers Harriman, similarly blamed the new dollar weakness in part on Trump's latest Russia controversy.

The news "not only heightened ongoing concerns about the Administration's ties with Russia but also is seen by some as jeopardizing the administration's aggressive legislative agenda," Thin wrote in a report on Tuesday.

Trump's economic proposals -- slashing taxes, cutting regulation and pumping up infrastructure spending -- lifted the US dollar after the election because many thought they could give the American economy a shot in the arm.

But Trump's agenda has been delayed by political setbacks, as evidenced by the failure thus far to repeal and replace Obamacare.

However, other currency analysts think the US dollar's stumble has little to do with Trump. They point to how the stock market appears unfazed by Trump's problems, with the S&P 500 hitting a record high on Tuesday.

"Trump's new soap opera story," isn't a main driver for the dollar, Peter Boockvar, chief market analyst at The Lindsey Group, wrote in a report.

Instead, Boockvar believes the greenback has been hurt by shifts in the global economy and central bank policy. He pointed to how the euro has been helped by a record European trade surplus in March, highlighted by a 13% jump in goods exports.

While Europe's economy has regained momentum, the US slowed down significantly at the beginning of this year. First-quarter GDP was just 0.7%, the weakest in three years. That's a far cry from the 3% or 4% growth Trump has been promising.

"It's not full steam ahead here by any means," said Schamotta.

Related: Trump rally built on Obama-like hope

Another big difference between the US and Europe: the euro has recently benefited from positive political news. France relieved global markets by electing Emmanuel Macron as its next president over Marine Le Pen, who had called for the nation to dump the euro.

The retreat for the US dollar isn't great news for Americans planning to travel abroad. Don't expect a big discount while shopping in Europe.

But the currency shift is just fine for big multinationals like Nike (NKE) and Apple (AAPL, Tech30) that sell lots of stuff overseas. A strong dollar makes an iPhone more expensive to foreign buyers.

That's why last month Trump told The Wall Street Journal the dollar is "getting too strong."

"Partially that's my fault because people have confidence in me," Trump said at the time.

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