What a Weaker US Dollar Means for the Economy

The dollar typically strengthens in times of economic or geopolitical strife, but in 2026 much of the uncertainty and political turmoil is coming from inside the US – and President Donald Trump has given a thumbs-up to the resulting plunge in the greenback. The dollar has dropped 9% overall against a basket of world currencies over the last year, and in January fell to its weakest level since March 2022. And the downward pressures don’t appear to be going away.

A weaker dollar reverberates across the US and global economies. In the US, prices of imported goods rise, making purchases of those products more expensive for American manufacturers and consumers, while American exports become more attractive to customers overseas.