The dollar experienced a decline against major currencies on Tuesday following the release of data indicating a significant widening of the U.S. trade deficit. The figures have fueled concerns among investors regarding the long-term health of the American economy and its ability to sustain its current growth rate.

Analysts suggest that the expanding trade deficit could lead to increased pressure on the dollar, potentially triggering further declines in its value. The market is closely watching upcoming economic indicators for further clues about the direction of the U.S. economy and the Federal Reserve’s monetary policy.

Currency traders are adjusting their positions in response to the news, with many reducing their holdings of dollars in favor of other currencies perceived as less vulnerable to the effects of the trade imbalance.