The U.S. dollar has dropped about 10% against a basket of other major currencies since early 2025. That shift is starting to show up in everyday costs: A weaker dollar means Americans get less when traveling abroad and may pay more for imported goods like food, fuel and electronics.
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Here's what to doPope Leo XIV encourages wealthy US Catholics to keep donatingLíder supremo iraní dice que Teherán protegerá sus"capacidades nucleares y de misiles"FILE- In this June 15, 2018, file photo, twenty dollar bills are counted in North Andover, Mass. FILE- In this June 15, 2018, file photo, twenty dollar bills are counted in North Andover, Mass. FILE- In this June 15, 2018, file photo, twenty dollar bills are counted in North Andover, Mass.
NEW YORK — A hidden force is quietly pushing up costs for everything from your summer vacation to your weekly grocery bills: a weaker U.S. dollar. The dollar has fallen about 10% against other major currencies since President Donald Trump returned to the White House, a pullback potentially playing a role in Americans’ concerns about affordability.
“It’s kind of a hidden tax,” says economist Thomas Savidge of the conservative-leaning American Institute for Economic Research. “What your dollar is going to be able to buy is going to shrink. ”in more than 50 years in the first half of 2025. Though the decline hasn’t deepened, the dollar index is still about 10% lower than the start of Trump’s term.
A strong dollar makes imports cheaper and can help keep inflation in check. A weak one can increase prices on foreign goods but boost American exports. U.S. presidents have long voiced support for a strong dollar even as they pursued policies that, at times, pushed the currency lower. Trump has suggested a strong dollar puts the U.S. at a disadvantage and that a weak dollar helps American industry.
And as with most things with Trump, he’s been blunter in his messaging.
“You make a hell of a lot more money with a weaker dollar,” he said last year, one of a number of public statements showing his preference for seeing the dollar decline. The Supreme Court is being asked to restore access to an abortion pill by mail.
Here’s what to knowIn recent months, corporate earnings calls have been peppered with talk of how a weaker dollar has helped companies from Philip Morris to Coca-Cola, with executives pulling out C-suite phrases like “favorable currency impact” to note how the dip brought tailwinds outside the U.S. that added to bottom lines.
“In many cases, we’ve got a weaker dollar, which is not unhelpful,” Elie Maalouf, the CEO of InterContinental Hotels, said on a February call as the company announced higher profits and revenues. For big multinational companies that do business overseas, a weaker dollar can spur sales for products that suddenly become cheaper. But the vast majority of U.S. businesses are not operating beyond the border.
For those catering to domestic customers, it’s a different story, particularly if they are reliant on importing goods. Travis Madeira, a fourth-generation lobsterman who founded the lobster-shipping business LobsterBoys with his brother, makes about 80% of his sales to Americans, unlike some competitors who primarily export.
“The exporters are gonna have the advantage when it comes to the dollar weakening,” says Madeira, who is paying more to import bait and buy Canadian lobsters. “These guys are gonna have a little bit of a lever on us. ”Even among companies that do have a presence outside the U.S., the dollar’s fall can have an impact.
While many big companies hedge currency to try and insulate themselves or push more sales overseas, smaller businesses are often more susceptible to the turbulence. David Navazio, CEO of Pennsylvania-based Gentell, which makes bandages and other medical supplies, operates plants in Brazil, Paraguay, Canada, New Zealand and the United Kingdom. In each location, the dollar has fallen, increasing Gentell’s costs.
Gentell has had to raise some prices to reflect the currency fluctuation, which stacks on top of other challenges, including tariffs and war-related spikes to fuel costs. For the American consumer, the reality of a declining dollar is most obvious during foreign travel or when making a purchase directly from an international seller. Cross the border into Mexico, the top foreign destination of Americans, and your dollar is about 16% weaker versus the peso compared with early 2025.
Declines of about 10% to 17% have been recorded elsewhere, including against the Swiss franc, South African rand, Danish krone, Swedish krona and the Euro. As for goods imported to the U.S., there is an impact, but it’s harder to gauge. Many economists estimate that, in advanced countries like the U.S., only about 5% to 10% of a currency dip is passed on to consumers.that has seen the biggest price hike in the past year.
Brazil is the biggest source of coffee for the U.S. and the dollar has fallen around 13% versus its real. Currency fluctuations can hit harder in developing economies and, while only a fraction of the change may feed into coffee’s ballooning price, every bit can pile up. Coffee prices are up nearly 19% in the U.S. in the past year, according to government data.
Currency values are constantly moving and, while the dollar’s recent fall is notable, it has reached lower levels at points in the presidencies of each of Trump’s predecessors, back through the creation of the Dollar Index in 1973, when Richard Nixon was at the helm. , says while “a lot of policies that Trump is doing are something of a cancer for the dollar,” he believes that it was destined to fall no matter who was in charge.
“The dollar had been on a 15-year bull run,” he said. “I would argue the dollar is still wildly overvalued, and over the next maybe five or six years, it might fall 15%. ” What does that mean for American consumers? Rogoff says commodity prices are likely to rise, particularly with the impact of the Iran war on fuel prices.
Kenneth Rogoff Iran War Economic Indicators General News AP Top News Richard Nixon International Trade Thomas Savidge The Coca-Cola Co. Consumer Products And Services Matt Sedensky Mexico Inflation Elie Maalouf Brazil Business U.S. News Iran David Navazio Politics Energy Markets World News Travis Madeira U.S. News World News
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