The greenback fell against other major currencies in the aftermath of allegations that Trump in February asked James Comey to end the FBI’s investigation into former national security adviser Michael Flynn.
The stunning reports — denied by the White House — deepened the political turmoil engulfing Trump’s White House and intensified concerns among investors about the president’s ability to push through his big economic plans.
“The inflammable allegations have spooked both currency and equity markets,” said Stephen Innes, a senior trader at online broker Oanda. “Foreign exchange dealers are in flat out sell the dollar mode.”
The U.S. currency dropped as much as 0.7% against the Japanese yen in morning trading in Asia on Wednesday. It also slipped as much as 0.3% against the euro.
Stock markets were also suffering, with most major indexes around Asia in negative territory. U.S. stock futures were down about 0.6%.
The dollar’s decline followed an ugly trading session in the U.S. on Tuesday. The dollar index, which measures the greenback against a basket of rival currencies, dropped to territory unseen since just after Trump’s election in early November.