As November’s midterm elections approach, US President Donald Trump must stop pushing for a weaker dollar, which will exacerbate the affordability pressures many Americans face and harm the country’s fiscal position. Fortunately, there are several policy instruments that could help the administration support domestic manufacturing.
NEW YORK—US President Donald Trump’s administration believes that the dollar’s reserve-currency status has tilted the global playing field against America and undermined the country’s competitiveness. While wrong about the dollar, the White House is right about an issue that economists—who, unlike voters, abstract from the exchange rate’s distributional effects—often ignore. As November’s midterm elections approach, the administration needs a policy pivot if it is to meet its rebalancing goals and strengthen the US economy.