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E C O N O M I C S
Edited by
Cristina Lindblad○ Biden may get the weaker
greenback that eluded Trump’s
presidencyA weaker dollar and the boost it could provide to
U.S. manufacturers and exporters has long been
part of President Trump’s prescription to make
America great again. But it could be his opponent,
Joe Biden, who gets a less mighty greenback and
its spoils.
The alleged unfairness of U.S. trading rela-
tionships with the rest of the world has been a
cornerstone of Trump’s rhetoric and actions.
Accusations of currency manipulation have been
as much a mainstay of his policy as tariffs on items
including solar panels and washing machines.
And grievances about the strength of the dollar—
often part of attacks against China, Europe, and
even the U.S. Federal Reserve—have peppered the
president’s Twitter feed.
The Fed’s trade-weighted measure of the U.S.
currency, which goes back to the 1970s, shows thedollar has on average been stronger since Trump’s
election than under his predecessors—and about
18% higher than during the eight years following
Barack Obama’s initial win. “Trump said he wanted
a weaker dollar, but what he did meant it got stron-
ger,” says Ned Rumpeltin, a currency strategist at
Toronto-Dominion Bank.
A big part of the equation was the relative eco-
nomic strength of the U.S. over recent years and
how that’s affected monetary policy and investor
returns. The expansion under Obama and Trump
was the longest on record, taking unemployment to
a half-century low, while recoveries in other major
industrialized nations lagged. Unlike its peers in
Europe and Japan, the U.S. central bank managed,
albeit briefly, to lift interest rates away from zero,
providing an appealing premium for investors that
helped buoy the dollar.
The Trump administration’s policies also played
a role in pumping up the greenback. Tax and reg-
ulatory changes increased corporate profitability,
which is why investors were willing to overlook the
mounting pile of debt. At the same time, the mar-
ket instability caused by the president’s trade war ILLUSTRATION BY BRÁULIO AMADO. DATA: FEDERAL RESERVEBloomberg Businessweek November 2, 2020