President Trump’s declarations of falling in love with the U.S. dollar will usher in a different type of romance between global financial markets and the U.S. dollar. The president stated that he is delighted at how a weaker dollar creates opportunities for businesses to thrive, saying that “I think it’s fantastic”.
He went on saying that it will be beneficial for American exporters and tech companies like Apple, as it will enable their products to be sold at an affordable price within the international market. However, as a result of this new way of looking at the world’s economy, we, as global citizens, may be presented with a brand new way of viewing our money.
Why Dollar Is Weakening?
Since the return of Trump to the Oval Office, the US dollar has dropped 10% of its value. Although the weaker dollar assists in closing the trade deficit, it also indicates that investors are becoming anxious now. The analysts highlight three prominent reasons for the weakening of the dollar.
1. Unpredictable Policy: The sudden tariff threats, including global tariff threats in 2025, have made investors worried about holding too many dollars.
2. Deb and Deficits: A rising federal debt load is making the dollar less lucrative as compared to safe-haven currencies and seems riskier.
3. Pressure on Fed: The continued demands from the White House to lower the interest rates are decreasing the trust and autonomy of the Federal Reserve.
The 2026 Gold Rush
The investors are increasingly rushing towards a 5000 years old alternative to the dollar, i.e., Gold. Surprisingly, the gold prices doubled during the last year and recently hit a record high of $5,500 per ounce. The gold is no longer a boring safe asset as its prices are increasingly swinging these days and behaving similarly to Bitcoin.
Read: Panic on Wall Street: How the Massive AI Tech Rout Just Drove Bitcoin to a 2026 Low
Is This a New “Weak Dollar Policy”?
Although Scott Bessent, the Treasury Secretary, contends that the US still encourages a strong dollar, the actions on real grounds are entirely opposite.
Economists argue that the administration has outwardly accepted a weak-dollar policy, but inwardly, it is pressuring other countries to alter their trade conduct.
Resultantly, the world is slowly moving away from dollar-based assets. This shift is considered a bankruptcy by Joseph Brusuelas, a famous economist. He argues by comparing the current situation with famous lines from Hemingway that “bankruptcy occurs slowly, then suddenly”.
Final Thoughts
The prevailing situation indicates that one chapter is going to end, and we are about to start a new chapter soon. The US is looking inward, emphasizing its trade interests, even if the price against is that it is weaker currency. Although the Dollar is not going to lose its throne as a global reserve currency within a single night, 2026 is all set to reset officially.
