By Erik Norland
For the past eight years, the U.S. dollar ((USD)) has been on an upward trend, rising substantially against most of its peers. Support came from three sources:
An improving U.S. fiscal situation from 2010 to 2016.
Substantially tighter monetary policy since 2016.
Stronger U.S. growth than in Europe and Japan, especially in 2011-13, and since 2017.
The first of the three sources of support for the dollar was undercut in 2017 when the U.S. budget deficit expanded from 2.2% of GDP in 2016 to 4.7% by mid-2019. Additionally, despite recent protectionist measures,