This renewed appeal for safety comes after months of growing doubt about the dollar’s automatic safe-haven status, a questioning that emerged when the currency didn’t react to a broad sell-off in global markets triggered last year by the implementation of tariffs.
On Monday, March 3, 2026, the dollar appreciated against all major currencies, with the dollar index gaining nearly 1%, its best day in seven months.
“Today is typically a risk-off day, from a U.S. Dollar perspective,” said Eric Theoret, FX strategist at Scotiabank.
“I consider ‘Liberation Day’ was a break from the historical analogies we had,” he added, referring to the announcement of massive U.S. Tariffs on April 2, 2025, which led to a sharp correction in global markets, including the dollar.
The rebound provides relief for the dollar, whose status as a safe haven had been challenged in recent months by the euro, the yen, and gold.
Analysts point to the depth and strength of U.S. Markets as factors supporting the currency. The U.S. Treasury market’s capacity to absorb large investment flows is a key advantage.
“If you’re looking to reduce your exposure and do it at scale, the U.S. Treasury market is the only one capable of absorbing those flows,” Theoret stated. When international investors flock to Treasuries during a crisis, it boosts demand for dollars.
Don Calcagni, chief investment officer at Mercer Advisors in Denver, believes the lack of credible alternatives makes it difficult for investors to move away from the dollar during periods of high volatility.
“So, I’m not surprised to see the dollar continue to play its role as a safe haven,” Calcagni explained.
The Dollar’s Safe Haven Appeal Intact
The dollar’s failure to attract safe-haven flows last year was largely due to the risk originating in the United States itself: Washington’s tariff offensive triggered the global sell-off, and investors were reluctant to seek refuge in the currency of the country causing the uncertainty, according to analysts.
“‘Liberation Day’ diminished the centrality of the dollar… Investors began to look to the rest of the world,” observed Benjamin Ford, a researcher at Macro Hive, a macroeconomic and strategic research firm.
“The oil shock then frightened global investors, who fled positions they had been chasing for three months to return massively to the dollar,” he added.
John Velis, macro strategist for the Americas at BNY, analyzes that the dollar’s safe-haven appeal appeared eroded only when the fear stemmed from the U.S. Itself, but remains intact when dealing with an international geopolitical crisis.
“The facts of the day clearly demonstrate this,” he said.
A Status Not Unshakable
But, not everyone is convinced the dollar will always remain such a robust safe haven under different circumstances.
“I think today’s activity is reassuring that the dollar retains its safe-haven characteristics,” said Jane Foley, head of FX strategy at Rabobank.
“But the debate is not closed,” she clarified.
On Monday, the dollar was supported not only by safe-haven flows but also by the United States’ status as a net energy exporter, which isolates the American economy from the oil shocks that typically hit importing countries.
Aaron Hurd, senior portfolio manager at State Street Investment Management, however, doubts the dollar will perform as well in the face of a shock unrelated to energy or liquidity concerns.
“If it’s simply a broad economic fear, the dollar will be far less effective,” he judged.
Given the high budget deficits in the United States, the volatility of public policies, and the level of global exposure to U.S. Assets, Hurd expects the dollar to remain, on average, more correlated with risky assets during major shocks.
In the short term, Benjamin Ford of Macro Hive believes the dollar’s evolution will depend on the price of oil.
“If we remain in a world where oil climbs and risk appetite declines, then the dollar will remain sought after,” he anticipates.
“However, if oil falls, traditional safe havens could come back to the forefront,” Ford continued, seeing the Swiss franc and the Japanese yen as beneficiaries.
