The "Sell America" Phenomenon: Why is the Dollar Under Pressure and Gold Continues to Strengthen?
In recent times, the global market has been abuzz with the term "Sell America." This phenomenon describes a situation where global investors begin reducing their holdings of United States-based assets, from US dollars and stocks to US government bonds. The impact is quite noticeable: the dollar weakens, while gold prices soar to record highs.
The term "Sell America" emerged when investor confidence in US policy direction was declining. Currently, this sentiment is fueled by various factors, such as rising geopolitical tensions, aggressive foreign policy, and uncertainty about the direction of the US economy. President Donald Trump's rhetoric regarding Greenland, threats of tariffs against Europe, and the potential for new trade conflicts have made global investors more cautious.
When investors begin selling US assets, the immediate effect is a weakening dollar. Many investors choose to withdraw funds from the US market and shift their capital to other regions or instruments perceived as more stable. As a result, the supply of dollars in the market increases, while demand decreases, putting pressure on the dollar's exchange rate.
On the other hand, this situation actually benefits gold. Gold is known as a safe haven asset that is often sought during times of heightened uncertainty. Furthermore, gold is traded in US dollars. When the dollar weakens, gold becomes relatively cheaper for global investors, increasing demand and pushing gold prices higher.
The "Sell America" phenomenon is also reinforced by expectations that the Federal Reserve will cut interest rates. Lower interest rates make the yields on dollar-based assets less attractive. Under these conditions, investors tend to choose gold, which is not dependent on interest rates but offers a hedge against inflation and geopolitical risks.
Simply put, the flow can be described as follows: increasing US uncertainty prompts investors to sell US assets, the dollar weakens, and global funds move to safe-haven assets like gold. As long as the "Sell America" narrative persists, pressure on the dollar is likely to continue, while gold remains strongly supported.
For market participants and traders, understanding this phenomenon is crucial because gold's current strong movement is not solely a technical factor, but rather the result of global fund rotation and major sentiment shifts. As long as confidence in US assets remains intact, gold has the potential to remain a favorite in global financial markets.
Source: Newsmaker.id
