The greenback slid on Tuesday, staying close to its recently hit three-year low, as the instability surrounding the Trump administration’s trade policies has been affecting the world’s largest economy.

The dollar index that gauges the greenback versus its major pairs dipped to 99.395, close to the lowest level hit in three years.

The index has fallen more than 4% this month, on track for its largest monthly decline since November 2022.

The dollar has struggled recently as shifting U.S. tariffs under the Trump administration have weakened investor confidence in the economy.

Trump proposed Monday that Mexico and Canada could be exempt from the 25% vehicle import tariffs, following previous exclusions for Chinese electronics like smartphones and laptops. These actions have eased market concerns over rising trade tensions.

EUR/USD edged up 0.1% higher to 1.1361, the single currency remains just below last week's three-year high of 1.1474, boosted by the turmoil surrounding the Trump administration's trade policies.

GBP/USD added 0.4% to 1.3230, following the release of the latest U.K. labor market data, which showed stable unemployment but continued high wage growth.

USD/JPY dipped to 142.92, the Japanese yen stays close to its highest point in six months, supported by persistent demand for safe-haven assets.