Get audio access with any FP subscription.

Subscribe Now

ALREADY AN FP SUBSCRIBER? LOGIN

Ongoing reports and analysis

The U.S. dollar’s sharp fall this week to its lowest level in nearly four years, while partly self-inflicted and exactly what U.S. President Donald Trump wants, may not be the best thing for the health of the world’s largest economy.

The dollar cratered on Tuesday, capping a week of steady decline that got briefly worse after Trump said a sliding dollar is “great.” The dollar has gotten weaker across the board, whether measured against a broad basket of other currencies, emerging-market, currencies, or big near-peer currencies such as the euro, against which the dollar has slid around 13 percent since Trump took office.

The U.S. dollar’s sharp fall this week to its lowest level in nearly four years, while partly self-inflicted and exactly what U.S. President Donald Trump wants, may not be the best thing for the health of the world’s largest economy.

The dollar cratered on Tuesday, capping a week of steady decline that got briefly worse after Trump said a sliding dollar is “great.” The dollar has gotten weaker across the board, whether measured against a broad basket of other currencies, emerging-market, currencies, or big near-peer currencies such as the euro, against which the dollar has slid around 13 percent since Trump took office.

The dollar’s doldrums come in the middle, and partially as a result, of a number of other tumultuous events in U.S. economic policy. 

The Trump administration threatened to take a NATO territory by force and threatened one of its biggest trading partners—the European Union—with higher tariffs before suddenly backing down, but that was enough to rattle global confidence.

The Trump........

© Foreign Policy