Deutsche Bank (NYSE: DB) has raised the possibility that the US dollar may be losing its traditional safe-haven status. In a note to clients, George Saravelos, the bank’s global head of FX strategy, called into question the greenback’s long-held dominance and underscores broader anxieties about the dollar’s role as the world’s preeminent reserve currency.

“We do not write this lightly,” Saravelos noted, pointing to the “speed and scale of global shifts” that have emerged in just a matter of days. His assessment marks a stark departure from the common view that, whenever market turbulence flares, investors will automatically flock to the US dollar.

Saravelos observed that despite the US forging ahead with tariffs aimed at several major trading partners, the dollar has not displayed the strengthening one would typically expect under such conditions.

Critics of the dollar supremacy point to these changes as evidence of a fraying consensus: tariffs deployed by the US, shifting security priorities, and a renewed focus on homegrown defense in Europe all have the potential to fracture faith in the US currency.

“What stands out in today’s market reaction is that the dollar is not strengthening materially,” Saravelos added. “We would not have expected these market moves at the start of the year.”

The potentially waning status of the dollar may reflect deeper geopolitical realignments, particularly as the European Union increases defense spending in the face of shifting US security commitments.

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