Is a weaker U.S. dollar a good thing?
The U.S. dollar’s value has fallen 8% over the past year, as the price of gold has skyrocketed, said the WSJ Dollar Index. Some think it is a good thing.
President Donald Trump said recently a weaker dollar is “great.” The idea is a weaker currency boosts exports and employment while a strong currency can throttle an economy.
While the idea of a weaker dollar has had supporters over the decades, economists often argue gains can be eaten up by domestic inflation and deflation.
A weaker dollar could help U.S. manufacturers compete by becoming less expensive to foreign buyers, and boost tourism. Yet it also means goods imported from abroad can become more expensive. Traditionally, the U.S. imports more from abroad than it exports.
Question: Is a weaker U.S. dollar a good thing?
Economists
James Hamilton, UC San Diego
NO: A cheaper dollar would provide stimulus by encouraging sales of U.S. exports but would aggravate inflation by raising the price of imported goods to firms and consumers. Inflation is a bigger concern for me at the moment, so I see the dollar weakness as a slight negative. Moreover, the reason for the weaker dollar is a loss of faith in the United States government. That is not a good thing.
NASA astronaut Jack Hathaway, Crew-12 pilot, arrives Friday, Feb. 6, 2026, at the Launch and Landing Facility at Kennedy Space Center. (Kim Shiflett/NASA)
Crew members of NASA’s SpaceX Crew-12 mission, from left to right, Roscosmos cosmonaut Andrey Fedyaev, NASA astronauts Jack Hathaway and Jessica Meir, and ESA (European Space Agency) astronaut Sophie Adenot, participate in a news conference from Astronaut Crew Quarters inside the Neil A. Armstrong Operations and Checkout Building at Kennedy Space Center on Sunday, Feb. 8, 2026. (Kim Shiflett/NASA)
The SpaceX Crew-12 crewmates, from left, Roscosmos cosmonaut Andrey Fedyaev, NASA astronaut and pilot Jack Hathaway, NASA astronaut and commander Jessica Meir and European Space Agency astronaut Sophie Adenot, performed a launch day rehearsal at Cape Canaveral Space Force Station on Monday, Feb. 9, 2026 ahead of the planned launch aboard the Crew Dragon Freedom later in the week. (Courtesy/SpaceX)