Emerging Market Currencies Slide Amid Dollar Strength and Tariff Uncertainty

Emerging market currencies weakened due to a stronger dollar and looming U.S. tariff threats. U.S. President Trump's plans to impose tariffs and other economic tensions have impacted currency indices. Central bank actions in Hungary and the Federal Reserve's upcoming decisions add further uncertainty to the currency markets.

Most emerging market currencies saw declines on Tuesday as the dollar strengthened amid new U.S. tariff threats from President Trump. The market faces uncertainty ahead of central bank decisions across different regions.

Trump announced plans to impose tariffs on imported goods like computer chips and some metals. A reported push by Treasury Secretary nominee Scott Bessent for universal tariffs starting at 2.5% exacerbated concerns.

The dollar index rose while currencies in tariff-sensitive economies, such as Mexico, suffered losses. Investors await key central bank decisions to gauge the future economic trajectory.

(With inputs from agencies.)