The new low for the US dollar this year, how will the weak dollar affect American consumers?

Before Federal Reserve Chairman Powell is set to speak at the Jackson Hole Economic Symposium this Friday, the US dollar fell more than 0.2% to 101.123 points during Wednesday's trading session, hitting its lowest level since December last year. Throughout August, the US dollar has been on a downward trend.

Previously, the US dollar experienced a decade of stable growth, reaching its highest level since the early 21st century in 2022. The pros and cons of a strong US dollar have once again become a focus, with Matthew C. Klein, co-author of "Trade Wars Are Class Wars," stating:

"I actually don't like using the term 'strong' for the dollar because it has positive connotations. What I really mean is that prices are higher now than they used to be, and the dollar can buy more foreign goods than it used to, which is good for those who need to buy foreign goods."

Analysts point out that the value of the US dollar depends on the economic conditions in the US and around the world, so it is difficult to simply say whether a strong US dollar is good or bad. Harold James, a history and international affairs professor at Princeton University, believes that a strong US dollar does enhance America's political influence, but when the dollar weakens, America's international influence also diminishes.

However, a strong US dollar also brings negative impacts. If the dollar is too strong, international consumers may not be able to afford American goods, leading to a decrease in overseas demand for US products, which can have adverse effects on American workers and the economy. James further points out that those who benefit from a strong dollar and those who benefit from a weak dollar are usually different groups.

Due to the potential negative impacts of a strong US dollar, US presidents do not always want the dollar to be too strong. Former President Donald Trump expressed concerns about a strong US dollar before the pandemic lockdown, especially its negative impact on US exports. Trump believed that the appreciation of the dollar was due to the monetary policy of the Federal Reserve.

During a press conference in February 2020, Trump stated: "Our Federal Reserve has brought us very low interest rates, they've also come with a very strong dollar. While a strong dollar has its benefits, it also makes it much harder for us to do business overseas."

Additionally, historically, US presidents' policies are closely related to employment and the economy, so changes in global trade policies can also affect the value of the US dollar