Every time mid-April comes around, I think of last year’s trade war. Back then, the U.S. dollar index fell from 104 all the way down to 98; now it looks like the starting point of global de-dollarization.

What’s interesting is that this April seems to be repeating the same story.

First, let’s talk about what happened last year. After Trump took out that tax rate chart at Mar-a-Lago, the market immediately erupted. The currencies of high-tax countries all plunged sharply, and panic hit an all-time high. But later, it was discovered that those tariffs were really just bargaining chips. The real turning point was this—rising trade protectionism actually led to a reversal of capital flows; money that had been pouring into the United States during the Biden period began to flow out instead. Led by the euro, emerging-market currencies followed suit.

More critically, the independence of the Federal Reserve was shaken. In mid-April, Trump publicly criticized Powell for cutting rates too slowly, and even threatened to remove the Federal Reserve chair. The market reacted right away: the one-year SOFR swap rate fell nearly 20 BP in a single month, and expectations for rate cuts over the year rose sharply. When monetary policy lost independence, the pace of dollar selling accelerated.

At the same time, central banks around the world began speeding up their gold purchases. Last April, gold officially broke through the $3,000 mark, and then kept moving higher. Behind this is a shift in global reserve asset allocation—replacing the dollar with gold as a reserve.

Now what? History seems to be repeating itself. The euro and the Australian dollar have already returned to their pre-war positions, and the yuan has even set a new intra-year high. Every time a negative piece of news appears, the dollar index’s rebound becomes weaker and weaker. The market is clearly rushing to price in a second round of de-dollarization—and not just in the FX market. The stock market response is even more intense: U.S. stocks recovered all losses, and the ChiNext index also climbed above 3,500 points.

I noticed one detail—the oil price is still above $95, but the market basically doesn’t care whether the U.S. and Iran can negotiate substantive results. What does this show? It shows that the market has already started absorbing the war’s impact in advance, and the focus has shifted to a deeper de-dollarization logic.

But what we need to stay calm about is that the dollar’s decline may not be smooth sailing. Right now, many assets have returned to pre-war levels, so the market power struggle among those that moved early will be even more intense. And as economic data gradually improves, the de-dollarization process that almost stalled in the second half of last year will need more negative factors to keep moving downward.

If the war ends in some way that is hard to call a success, the dollar’s decline may continue. But the key still depends on the direction of subsequent policy. After the Mar-a-Lago agreement, the strength of policy implementation will directly affect the dollar’s long-term trend.