The US dollar dropped 10% over the past year. Trump thinks 'it's great.' But here's what it really means for your money

If President Donald Trump thinks that the U.S. dollar’s 10% driblet implicit the past twelvemonth is “great,” arsenic helium said during a caller halt successful Iowa (1), past helium whitethorn beryllium thrilled to perceive that it fell adjacent further pursuing his clasp of the decline.

In fact, the dollar dove astir different 1.5% aft the president added his 2 cents, marking its lowest constituent since February 2022. It was besides the steepest single-day plunge since past April (2), erstwhile it dropped 2% conscionable days aft Trump’s “Liberation Day” planetary tariff announcement.

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“I deliberation it’s great. I mean the worth of the dollar, look astatine the concern we’re doing,” Trump told reporters successful Iowa erstwhile asked astir the dollar’s diminution (1). He added that helium could person the U.S. dollar “go up oregon spell down similar a yo-yo” but alternatively preferred to let it to “seek its ain level, which is the just happening to do.”

It’s not the archetypal clip Trump has touted the advantages of a anemic dollar for businesses similar manufacturers and exporters. Last July, helium told reporters (3) that “a anemic dollar makes you a hellhole of a batch much money,” claiming, “when we person a beardown dollar … It sounds good. But you don’t bash immoderate tourism, you can’t merchantability tractors, you can’t merchantability trucks, you can’t merchantability anything.”

Many property the dollar’s drop-off implicit the past twelvemonth to assorted factors, from Trump’s tariffs and progressively unstable planetary policies (4) to his ongoing combat implicit the independency of the Federal Reserve (5). And some, similar Pinnacle Investment Management main concern strategist Anthony Doyle, pass that the president’s flippancy could nonstop the incorrect connection to planetary investors.

“When the idiosyncratic who could jawbone to support the currency sounds unconcerned, the perceived backstop nether the dollar gets thinner,” Doyle said successful a caller interrogation with Bloomberg (6).

“Markets are reopening the question of whether the US is asking investors to judge a little modular of stability, and truthful demanding a higher terms for bearing U.S. risk.”

The continued autumn of the U.S. dollar comes aft a 12-month play ending successful December erstwhile user prices roseate 2.7% (7). Food prices, successful particular, outpaced that average, rising 3.1%.