The U.S. dollar, along with related exchange traded funds (ETFs), could be weakening as the attractiveness of U.S. assets diminish.

Stephen Gallo, head of market analysis at Schenider Foreign Exchange, says the dollar is only just starting to fall, as stated in Moneynews. The dollar recently dropped 5% against the euro and it now trades at around $1.38 to the euro.

As the global economy bottoms out, Thomas Harr, senior foreign exchange strategist for Standard Chartered Bank, thinks investors will no longer need to use the dollar as a safe haven, writes Dan Well for Moneynews.

Furthermore, the large deficits incurred by the U.S. government could reduce America’s investment grade rating and this would drive investors away from the dollar and devalue the currency even more.

Investors are also anticipating more U.S. government debt sales, which are consequently driving down Treasuries even more, reports Susanne Walker for Bloomberg.

President Barack Obama has been pushing up the country’s tab, totaling an impressive $6.36 trillion. The current administration estimates the deficit for the year will be a record $1.84 trillion, or equal to around 13% of GDP.

• PowerShares DB U.S. Dollar Index Bullish (UUP): down 3.8% year-to-date

• PowerShares DB U.S. Dollar Index Bearish (UDN): up 2.9% year-to-date

Max Chen contributed to this article.

Tags: Currency ETFs, Obama, U.S. Dollar, UDN, UUP